Appendix B: State-by-State Rules of Intestacy and Estate or Inheritance Tax

• Author: Margaret A. Munro, Kathryn A. Murphy
• Profession: Has more than 30 years' experience in trusts, estates, family tax, and small businesses/Attorney with more than 20 years' experience administering estates and trusts and preparing estate and gift tax returns
• Pages: 369-400

APPENDIX B State-by-State Rules of Intestacy and Estate orInheritance Tax 369

Appendix B

State-by-State Rules of

Intestacy and Estate

orInheritance Tax

The laws of intestacy (how a decedent’s estate is distributed when no valid

last will exists), as well as the wording in state statues, vary by state. We

summarize a portion of these laws to give you a taste of the similarities and

dierences between states. However, because these laws can be quite complex,

consult with a competent attorney who’s an expert in estate law before you make

any intestate distributions. Keep in mind that although these are the laws in eect

as this book is published, they’re subject to change. To look farther down the line

of descent and distribution than what we provide here, refer to your individual

state statute regarding intestacy.

In addition to the federal estate tax, some states impose their own version of an

estate tax (where the estate is taxed on the transfer of property), others have an

inheritance tax (where the beneciary is taxed on the transfer of property), some

have both, and many have neither. The following list tells you what’s in place as

this book goes to print, but like the laws of intestacy, bear in mind that everything

can change at a moment’s notice.

In states that recognize same-sex marriages, be aware that, under current law,

the state probate and estate tax rules aren’t the same as the federal estate tax

rules. It is possible that, in these families, there may be a federal estate tax due

where, for state purposes, there is a surviving spouse and thus, a marital deduc-

tion available.

370 Estate & Trust Administration For Dummies

Alabama

Rules of Intestacy

»

Surviving spouse:

•

No surviving issue or parent: 100 percent of estate.

•

No surviving issue but surviving parents: First $100,000 plus ½ of the

remaining estate balance.

•

With issue that are all also the issue of the surviving spouse: First

$50,000 plus ½ of the remaining estate balance with the remainder

distributed equally among the issue.

•

With issue that aren’t all issue of the surviving spouse: ½ of the estate

with the remaining ½ distributed equally among the issue.

»

No surviving spouse (or portion not distributed to surviving spouse):

•

With issue: Estate distributes equally among the same degree of kinship.

With unequal degrees of kinship, those of more remote degree take by

right of representation.

•

No issue but surviving parents: Parents share equally.

For further levels of descent and distribution, see state intestacy statute.

State Estate Taxes: Decedents dying after December 31, 2004, no estate tax return

required. For decedents dying prior to January 1, 2005, contact the Alabama

Department of Revenue, 50 North Ripley St., Montgomery, AL 36132; Phone:

334-242-1034; Website: www.ador.state.al.us for further information.

Alaska

Rules of Intestacy

»

Surviving spouse:

•

No surviving descendant or parent of the decedent, or all descen-

dants of decedent are also descendants of surviving spouse and no

other descendants of surviving spouse survive decedent: All the estate.

•

No descendants but a surviving parent: First $200,000 plus ¾ of the

remaining estate with remainder distributed equally among parents.

APPENDIX B State-by-State Rules of Intestacy and Estate orInheritance Tax 371

•

All the decedent’s surviving descendants are also descendants of the

surviving spouse, and the surviving spouse has one or more surviving

descendants who are not descendants of the decedent: First $150,000

plus ½ of the remaining estate with the remainder of the estate to

decedent’s descendants by representation.

•

If one or more of the decedent’s surviving descendants are not

descendants of the surviving spouse: First $100,000 plus ½ of the

remaining estate with the remainder of the estate to decedent’s descen-

dants by right of representation.

»

No surviving spouse (or portion not distributed to surviving spouse):

Same as Alabama, but substitute “descendant” for “issue” wherever it appears

in this regard.

State Estate Taxes: Decedents dying after December 31, 2004, no estate tax return

required. For decedents dying prior to January 1, 2005, contact the Alaska Tax

Division, 550 West Seventh Avenue Suite 500, Anchorage, AK 99501-3555; Phone:

907-269-6620; Website: www.tax.alaska.gov for further information.

Arizona

Rules of Intestacy

Note: The intestate estate consists of 100 percent of separate property and

50 percent of community property.

»

Surviving spouse:

•

No surviving issue or all surviving issue are also issue of surviving

spouse: 100 percent of estate.

•

Surviving issue and one or more aren’t issue of surviving spouse:

50 percent of separate property with no interest in decedent’s 50 percent

of community property.

»

No surviving spouse (or portion not distributed to surviving spouse):

Same as Alabama, but substitute “descendant” for “issue” wherever it appears

in this regard.

State Estate Taxes: Decedents dying after December 31, 2004, no estate tax return

required. For decedents dying prior to January 1, 2005, contact the Estate Tax

Oce, Arizona Department of Revenue, 1600 West Monroe, Phoenix, AZ 85007-

2650; Phone: 602-255-3381; Website: www.azdor.gov for further information.