After the death of a parent, the last thing you are probably thinking about is paying taxes. However, taxes are one thing even death does not stop. In fact, you may be on the hook to pay certain taxes out of your parent’s estate. The Illinois probate process will solidify what you owe and to who, but knowing ahead of time can help to make things easier when the time comes.
One thing to know, according to Smart Asset, is that estate taxes only apply if your parent’s estate has a value of at least $4 million. If it is worth any less, then you will not have estate taxes. Do note that there may be other taxes that you have to pay and you are only exempt from the state’s estate tax.
If estate tax is due, the state bases on a graduated percentage according to the overall value of your parent’s estate. The highest amount you will pay is 16% of the value of the estate. The calculations for figuring this tax are a little complex. You have to do quite a bit of math to get the actual amount due.
You will have to figure the estate based on value and the graduated tax percentage. You also have credits that will usually exempt the first $40,000 from being taxed.
Other taxes the estate may have to pay include taxes from other states if you or another heir live in another state and will receive property from the estate, federal estate taxes and federal gift taxes. Do note that the court will pay all taxes before disbursing assets to heirs. This information is for education and is not legal advice.