Georgia Estate Tax Laws

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Most states have separate laws for inheritance and estate taxes. In addition, there are federal laws regarding the treatment of each such situation. Inheritance and estate taxes are not the same thing, differing based upon who is responsible for paying the tax. In Georgia, those who receive money from an estate will only need to pay a tax to the state under certain circumstances.

Georgia Inheritance Tax

The state of Georgia does not have an inheritance tax. However, you might hear others refer to the estate tax as inheritance tax. An estate tax differs from inheritance tax in that the former is paid by the estate before assets from it are distributed to heirs. This tax is not paid by the person inheriting the assets. An inheritance tax, on the other hand, is money that a person pays on inherited property after its previous owner has died. As of 2016, there are only six states remaining that impose an inheritance tax. These states are Nebraska, Iowa, Kentucky, Pennsylvania, New Jersey and Maryland.

Georgia Estate Tax

The state of Georgia no longer has an estate tax. As of July 1st, 2014, the law was amended to prevent estate taxes from being levied by the state going forward. This legislation was passed under O.C.G.A. § 48-12-1.

This law states that there would be no new estate taxes levied by the state after the July 1, 2014 date. Any taxes, penalties or interest that were required by the law prior to that date, however, would still be in effect. Those payments were to be overseen by the provisions of the old law. Similarly, any illegal activity related to estate taxes prior to July 1, 2014 would still be prosecuted according to the law as it stood at that time.

The state of Georgia’s estate tax up until July 1, 2014 was valid only on decedents with a date of death before January 1, 2005. This is based on federal estate tax law. In addition, before an estate tax must be paid, the value of the gifted assets must be examined. In many cases, estates don’t ever reach the threshold requiring that taxes be paid.

Read More: Estate Laws for Insolvent Estates in Georgia

Federal Estate Tax Law

At the time of your death, all of your assets are assessed according to their fair market value to determine what is known as your "gross estate." Deductions may be made from this total to determine what the federal government terms your taxable estate. After computing this number, any gifts made to others throughout your lifetime (after the year 1977) is added to total. Any unified credit is then deducted.

In some instances, a federal estate tax will be levied, dependent upon the total of the combined gross estate and prior taxable gifts. These amounts vary depending on the year of the decedent’s death. For instance, the filing threshold was $1,500,000 in 2004; it increased gradually until 2017, and then new tax laws made it $11,180,000 in 2018. If a decedent who passed away after January 1, 2011 has a surviving spouse, that individual may use any unused exemption remaining in the estate.