Ohio repealed its estate tax for deaths occurring after January 1, 2013. However, deaths occurring prior to the repeal continue to trigger Ohio estate taxes. The executor of a decedent's estate must file an estate tax return and pay taxes due from the estate's assets. Taxes are based on the size of an estate, but Ohio offers estate tax credits to offset or completely eliminate these taxes.
All assets owned solely by Ohio decedents pass through probate and are potentially subject to Ohio estate taxation. Assets held in trust or jointly with third parties do not pass through probate. In general, an executor must show both a decedent's probate and non-probate assets on an Ohio estate tax return. Certain life insurance proceeds are an exception to this rule. For example, a life insurance policy naming a child as beneficiary generally does not need to be claimed on an estate tax return.
Estate Tax Repeal
After January 1, 2013, decedent estates in Ohio will not be required to pay estate taxes. Generally, estates worth less than $338,333 and opened prior to 2013 avoid Ohio estate tax while estates larger than $383,333 are subject to graduated taxation. For example, an estate with a gross value between $338,333 and $500,000 is taxed $13,900 plus 6% of the excess over $338,333.
Estate tax credits are available to offset Ohio's estate taxation. For example, if a decedent died between Janury 1, 2002 and January 1, 2013, her estate is entitled to a $13,900 tax credit. A surviving spouse is entitled to an unlimited credit which means spouses generally pay no estate taxes. Ohio also allows deductions for things such as funeral costs, legal fees, charitable donations and out-of-pocket medical expenses. Even if an estate owes no estate taxes, a return should be filed if is not covered by the 2013 repeal.
An executor who is obligated to file an Ohio estate tax return must do so within 15 months after the decedent's death. Two copies of the return must be filed with the probate court. Taxes due should be paid to the county auditor. Generally, penalty and interest applies to late payments. Proper estate tax forms can be obtained from the Ohio Estate Tax Division's website or can be mailed upon request.
Seek Legal Advice
Many Ohio estate tax issues are affected by the year in which a death occurs. Specific questions regarding Ohio estate tax laws should be directed to an Ohio tax attorney or accountant.
- Ohio Department of Taxation: FAQs -- Estate Tax
- Probate Court of Cuyahoga County: Estate FAQ's
- The Ohio State University: Estate Planning Considerations for Ohio Families: Ohio and Federal Estate Settlement Costs
- Franklin County Probate Court: Estate Administration Information
- Forbes: Ohio Repeals Its Estate Tax; Maine and Oregon Tweak Theirs
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