Estate Taxes in Ohio

Even though the Ohio estate tax was repealed effective January 1, 2013, there are still estate taxes in Ohio.  A decedent’s estate may still have to pay a federal estate tax of 40% of the gross estate that is more than $5.34 million.  5.34 million dollars is the exempt amount that is not subject to federal taxation.  One may deduct funeral and burial expenses, payment of debts, charitable gifts, and most transfers to the surviving spouse.  One cannot exempt transfer on death or payable on death property from estate taxes.   A federal estate tax return (Form 706) does not always need to be filed.  When the decedent’s gross estate is more than the exempt amount, the return must be filed, even if it shows that no tax is owed.  Filing a federal estate tax return can allow a surviving spouse to combine his or her exemption with the deceased spouse, otherwise called a “portability election.”  If a wife inherits five million dollars from her deceased husband and files a federal estate tax return on the unused exemption, the wife would have $10.34 million in exemptions available in her estate upon her death.   (more…)