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Estate Tax and Inheritance Tax in Kansas Estate Planning

Weber Law Dec. 9, 2018

If you live in Kansas, your estate will not be subject to a state estate tax when you pass away. Despite the absence of a state estate tax, Kansas residents still need to know a little something about estate tax, because their estates could be subject to the federal estate tax. Also, Kansas residents who inherit from Kansas estates or estates in other states need to understand inheritance tax, because they may be responsible for paying an inheritance tax when they collect an inheritance. Basic awareness and understanding of state and federal estate, inheritance, and gift taxes will help you and your estate planning attorney, create a comprehensive Kansas estate plan that will accomplish your estate planning goals.

Kansas is one of the thirty-eight states that does not collect estate tax. The federal estate tax applies to all estates in the United States of America that have a valued of slightly over eleven million dollars and are owned by a single person. Married Americans should know that the federal estate tax that applies to them is the tax on combined marital estates worth over 22.36 million dollars. The amount of federal estate tax that will be levied on an estate depends upon the size of the taxable estate, and there is a maximum federal estate tax rate of forty percent. The federal estate tax is calculated on the value of the taxable estate, which is the amount that remains after subtracting the applicable 11.18 million or 22.36 million estate tax exemption from the total value of the estate. The federal estate tax is calculated and paid before the estate is distributed to the decedent’s heirs.

Kansas residents who inherit assets from Kansas estates do not pay an inheritance tax on those inheritances. If you live in Kansas and you inherit from a decedent in a different state, you may be responsible for paying inheritance tax on it. If you receive an inheritance from an out-of-state estate, it is crucial that you check with an estate planning attorney or financial planner who knows the estate and inheritance taxation rules for the state where the estate originated so that you can know whether you must pay an inheritance tax on what you received. Lack of awareness of an inheritance tax payment that should have been made can create headaches later on when the state imposing the tax seeks to collect not only the amount of the tax but penalties and fines for failing to pay the tax promptly.

Understanding state and federal estate, inheritance, and gift taxes can help you create an estate planning strategy that will meet your estate planning goals. Your Kansas estate planning attorney can help you understand the possible tax implications of the various elements of your current or anticipated estate planning strategy so that you can plan for and provide for them as part of your overall estate plan. To learn more, schedule a no-obligation consultation with Wichita attorney J. Joseph Weber. Our attorneys can help you set estate planning goals and create an estate plan designed with those goals in mind. Please call our office or connect with us online.