State Inheritance Tax

This is a tax on the right of an heir to receive property from the estate of the deceased. The value of the decedent's estate as a whole does not help to determine the inheritance tax. The relationship of the heir to the decedent and value of the share received determine the tax. Bequests to "distant" relatives (regardless of how close they are emotionally) get taxed at a higher rate than those to "close" relatives.

States divide heirs into classes in order to determine the tax rates for the "types" of relatives.

In addition to the state inheritance tax, states may also apply the credit estate tax.