News Release: Unicameral approves bill to cut inheritance tax
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Contact: Adam Weinberg
Unicameral approves bill to cut inheritance tax, exempt younger beneficiaries
78% of Nebraskans support going farther with complete repeal
LINCOLN, NE – Today, the Nebraska Legislature has given final approval to Sen. Robert Clements’ Legislative Bill 310, which reduces Nebraska’s county-levied inheritance tax. The bill passed by a vote of 37-1. Platte Institute Chief Executive Officer Jim Vokal is available for comment on this development.
With an amendment provided by the Legislature’s Revenue Committee and provisions from another inheritance tax-related bill by state Sen. Wendy DeBoer, the enacted version of LB310 makes these changes to the tax, effective in 2023:
- People under age 22 will be fully exempt from inheritance tax.
- Nebraska’s top two inheritance tax rates for more distant relatives and unrelated heirs will be reduced by approximately fifteen percent, declining from 18% to 15% on the top rate, and from 13% to 11% on the middle rate. The amount of inherited property exempt from these two classes of the tax increases to $25,000 and $40,000, respectively.
- The lowest inheritance tax rate for nearer family members (besides spouses, who are currently exempt) is unchanged at 1%, while the amount of inherited property exempt from this tax rate increases to $100,000.
- Step-family members who were not adopted as children will no longer be taxed at a higher rate than other similar relatives in a blended family.
“Senators should be commended, but not coddled, for passing LB310. The Legislature took a good first step that will modernize Nebraska’s county inheritance tax and prevent more families and businesses from having to pay inheritance tax. Fully exempting many younger people from the tax is an especially good achievement. But 78% of Nebraskans, including solid majorities of Republicans, Democrats, and independents, say they don’t want anyone to have to pay inheritance tax in Nebraska. We’re currently on track to become one of only five states that levies an inheritance tax. With our neighbors in Iowa phasing out this tax by 2025, we will be the only state west of the Mississippi River that imposes an extra tax when people receive property from a loved one who has died. Forty-five other states have figured out how to get by without inheritance taxes. Nebraska can do it too. Senators should come back every year and build upon the progress they’ve made with LB310 until every family and business is free from this outdated and inequitable tax,” Vokal said.
To schedule an interview, or for more information, please contact Adam Weinberg at (402) 500-0209 or firstname.lastname@example.org.
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