How do I get an Inheritance Tax Waiver?

Jodee Redmond
Jodee Redmond
Lawyers and estate planners often look for ways to help clients distribute assets in such a way that beneficiaries can escape some of the tax consequences.
Lawyers and estate planners often look for ways to help clients distribute assets in such a way that beneficiaries can escape some of the tax consequences.

An inheritance tax waiver is mandatory in certain jurisdictions in the United States. The document is used in estate matters and it is used as proof that any required inheritance taxes have been paid by the deceased's beneficiaries. In states where the document is required, the Department of Revenue, State Controller or Department of Taxation is responsible for issuing it.

As of the spring of 2011, the District of Columbia and 34 states do not require an inheritance tax waiver be prepared. Estate taxes may still need to be paid in those jurisdictions, depending on the applicable state laws. In some other parts of the U.S., the tax waiver is only used in cases where the deceased passed away before a set date or when there is no surviving spouse.

The applicable law governing whether an inheritance tax waiver must be obtained depends on where the deceased resided at the time of her or her death. The document may be required when the assets being transferred to a beneficiary are stocks. In certain cases, the regulations about whether an inheritance tax waiver is required is determined by where the corporation which issued the stock is located.

If an inheritance tax waiver must be completed, the beneficiary or a representative acting on his or her behalf must request a copy of the form from the appropriate government agency. Forms may also be available online from the government office's website for download.

In some states, a portion of the deceased's bank account is transferred into the estate account and the remaining funds are frozen until after any inheritance taxes are paid. The form must be fully completed and submitted to the agency for processing before the frozen funds will be released.

The waiver form includes the name, Social Security number, date of death and the deceased's last address. It also lists account information for the deceased, including the account balance as of the date of death. The names and contact information for the beneficiaries are also listed on the document.

Once the inheritance tax waiver is filed, it is reviewed to determine that the information is in order and the correct amount of tax has been paid. If the information on the form is true and correct, the state will issue one or more tax waivers. Each waiver will apply to a specific bank or investment account. The executor for the estate requests that the bank release any frozen funds from the estate.

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    • Lawyers and estate planners often look for ways to help clients distribute assets in such a way that beneficiaries can escape some of the tax consequences.
      Lawyers and estate planners often look for ways to help clients distribute assets in such a way that beneficiaries can escape some of the tax consequences.