what is inheritance tax 
an inheritance tax is a tax imposed by some states on the recipients of inherited assets in contrast to an estate tax an inheritance tax is paid by the recipient of a bequest rather than the estate of the deceased the inheritance tax is not common in the u s in fact just six states have an inheritance tax as of 2023 the taxation of an inheritance depends on the state in which the deceased lived or owned property the value of the inheritance and the beneficiary s relationship to the decedent 1understanding inheritance taxesthere is no federal inheritance tax in the u s while the u s government taxes large estates directly imposing estate taxes and if relevant income tax on any earnings from the estate it does not impose an inheritance tax on those who receive assets from an estate 2inheritance taxes are collected by six u s states iowa kentucky maryland nebraska new jersey and pennsylvania 3whether an inheritance will be taxed and at what rate depends on its value the relationship of the beneficiary to the person who passed away and the prevailing rules where the decedent the person with the estate lived 4that is inheritance taxes may be assessed by the state or states where the decedent lived or owned property if those states impose an inheritance tax 4 as a beneficiary your state s inheritance tax rule if any doesn t apply in other words if you receive an inheritance from someone who lived in a state with no inheritance tax you won t pay an inheritance tax even if you live in a state with an inheritance tax normally your inheritance must be greater than a certain minimum amount for you to owe taxes on it that means that few people only around 2 typically ever have to pay an inheritance tax 5an inheritance tax is not the same as an estate tax an estate tax is assessed on the estate itself before its assets are distributed while an inheritance tax may be imposed on the beneficiaries of a bequest 