Forbes has published an article, “Another State Ditches Its Death Tax While Potential Backdoor Federal Estate Tax Looms”, which discusses Iowa’s recent move to repeal the inheritance tax. The article begins as follows:
In a sign of the political divide over death taxes, Iowa is repealing its inheritance tax, with a phased-in reduction of the tax bite retroactive to January 1, and full repeal as of January 1, 2025. Abolishing the state inheritance tax was a key priority for Republican Governor Kim Reynolds; it was part of a larger tax cut package that speeds up income tax cuts signed into law earlier this summer.
Iowa’s inheritance tax repeal comes along while proposed federal death tax changes could mean many more estates will face federal taxes at much lower wealth levels.
Iowa’s move will leave five states with an inheritance tax, and 11 states and the District of Columbia with an estate tax (See Where Not To Die In 2021 for the full list). Kentucky, Maryland, Nebraska, New Jersey and Pennsylvania are the other inheritance tax states. Maryland has the dubious distinction of having both an inheritance tax and an estate tax. Iowa’s repeal makes Nebraska “a clear geographic outlier,” notes Sarah Curry, policy director with the Platte Institute.
Click here to see the full article: “Another State Ditches Its Death Tax While Potential Backdoor Federal Estate Tax Looms”
Posted by Marin Larkin, Associate Editor, Wealth Strategies Journal.