Inheritance Tax vs. Estate Tax: What’s the Difference?
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What is the difference between Inheritance Tax and Estate Tax?
Inheritance tax is a tax imposed on the beneficiaries who receive assets from a deceased person’s estate, while estate tax is a tax levied on the total value of a deceased person’s estate before it is distributed to beneficiaries.
Who pays the taxes in the case of Inheritance Tax and Estate Tax?
In the case of Inheritance Tax, the beneficiaries who receive assets from the estate are responsible for paying the tax. On the other hand, estate tax is typically paid by the estate itself before any assets are distributed to beneficiaries.
How are the tax rates determined for Inheritance Tax and Estate Tax?
The tax rates for Inheritance Tax and Estate Tax are determined by the government and can vary depending on the total value of the estate and the relationship between the deceased person and the beneficiaries. In some cases, certain exemptions or deductions may apply to reduce the tax liability.
Are there any differences in terms of exemptions for Inheritance Tax and Estate Tax?
Yes, there are differences in exemptions for Inheritance Tax and Estate Tax. Inheritance Tax exemptions are typically based on the relationship between the deceased person and the beneficiaries, while Estate Tax exemptions may vary depending on the total value of the estate.
The image is not directly related to the article. It merely symbolizes the life of elderly people. What is the difference between Inheritance Tax and Estate Tax? Inheritance tax is a tax imposed on the beneficiaries who receive assets from a deceased person’s estate, while estate tax is a tax levied on the total value…
