Inheritance and Estate Transfer Taxes

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Who must file

The inheritance tax is imposed on the heirs or legatees of a decedent for the privilege of receiving property from the deceased. Effective January 1, 2008, inheritance tax shall not apply to deaths that occur after June 30, 2004. See Acts 2008, No. 822.

For deaths that occurred before July 1, 2004—the following apply:

  • R.S. 47:2425(A) requires that an inheritance tax return be filed for the succession, by or on behalf of all the heirs or legatees, if inheritance tax is due or the gross value of the deceased's estate is $15,000 or more.
  • R.S. 47:2410 allows for a small succession if the decedent has no will, no immovable property, and the estate’s value is less than $50,000.
  • Inheritance taxes due to the state for deaths occurring before July 1, 2004, for which no inheritance tax return has been filed before January 1, 2008, shall be deemed due on January 1, 2008, and shall prescribe three years from the 31st day of December of the year in which the taxes became due, which would be December 31, 2011. See Acts 2008, No. 822.

Inheritance Tax Rate

Heirs or legatees pay tax on the taxable value of their inheritance, legacy, and donation or gift in contemplation of death, at the following rates determined by their relationship to the deceased:

  • Direct descendants by blood or affinity or ascendants—Two percent of the first $20,000 taxable value and three percent of the taxable value in excess of $20,000.
  • Collateral relations of the decedent, including brothers and sisters by affinity and their descendants—Five percent of the first $20,000 taxable value plus seven percent of the taxable value in excess of $20,000.
  • Strangers or nonrelated persons—Five percent of the first $5,000 taxable value plus ten percent of the taxable value in excess of $5,000.

Acts 1997, No. 818 enacted R.S. 47:2403(E) to reduce the inheritance tax by 18 percent for deaths that occur after June 30, 1998; by 40 percent for deaths that occur after June 30, 2001; by 60 percent for deaths that occur after June 30, 2002; by 80 percent for deaths that occur after June 30, 2003; and for deaths that occur after June 30, 2004, the tax shall not apply.

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Inheritance Tax Exemptions

Charitable, religious, and educational organizations are exempt from the inheritance tax.

Inheritance Tax Due Date

For deaths occurring before July 1, 2004, for which an inheritance tax return was not filed before January 1, 2008, an inheritance tax return and any taxes are due to the Secretary of Revenue by January 1, 2008.

Who must file an estate transfer tax return

Revised Statute 47:2436 requires that an estate transfer tax return be filed by or on behalf of the heirs or legatees in every case where estate transfer tax is due or where the value of the deceased's net estate is $60,000.00 or more.

How is estate transfer tax calculated?

The estate transfer tax is calculated by determining a ratio of assets included in the federal gross estate attributable to Louisiana to the total federal gross estate. This ratio is applied to the state death tax credit allowable under Internal Revenue Code Section 2011. The portion of the state death tax credit allowable to Louisiana that exceeds the inheritance tax due is the state estate transfer tax.

The Economic Growth and Tax Relief Reconciliation Act of 2001 phased out the state estate tax credit between 2002 and 2005 and replaced the credit with a deduction for state estate taxes for deaths that occur after December 31, 2004. Because R.S. 47:2432 only imposes the estate transfer tax if a state death tax credit is allow against the federal estate tax, no state estate transfer tax is due for deaths after December 31, 2004. However, the Economic Growth and Tax Relief Reconciliation Act of 2001 provisions will sunset on January 1, 2011, and the Internal Revenue Code will revert to the provisions that were in effect before it was passed unless further legislation is enacted to make its changes permanent. If Congress fails to make the Act’s changes permanent and the state estate tax credit is restored, the state estate transfer tax will again be due.

Are there any exemptions from estate transfer tax?

No. The inheritance tax exemptions do not apply to estate transfer tax.

Are interest and penalties assessed on delinquent estate transfer taxes?

There is no interest or penalties assessed on delinquent estate transfer taxes.

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