LB310: Modernize and Reduce Nebraska’s Inheritance Tax

Introduced on January 12, 2021
Status: Signed into Law

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Summary

The Platte Institute provided testimony in support of LB310. Nebraska is one of only five states that will levy an inheritance tax in the years ahead and one of only two states that tax children and grandchildren who receive inheritances from their parents or grandparents. Iowa is currently in the process of phasing out its inheritance tax by 2025. Because Nebraska’s tax was created in 1901, many of its provisions are in need of modernization, including the relatively low amount of property value that is subject to tax. Nebraska’s top 18% inheritance tax rate on non-relatives and distant relatives is also the country’s highest tax rate. The amended version of LB310 would reduce the top county-collected inheritance tax rate and increase the amount of property that is exempt from the tax for lineal heirs from $40,000 to $100,000. Other important changes to in the amendment include a complete exemption from inheritance taxes for Nebraskans under age 22 and a new requirement for county treasurers to report to the Legislature annually about their inheritance tax collections.

CLICK HERE TO VISIT THE NEBRASKA LEGISLATURE WEBSITE TO SUBMIT WRITTEN COMMENT ABOUT LB310.

Last Action

LB310 was signed into law by the governor on February 17, 2022. Its provisions take effect in 2023.