By Nathan Vinson, Attorney
English, Lucas, Priest and Owsley
Ah, Florida. It calls to retirees like the mythical siren calls to sailors. Warm weather, year-round golf, palm trees on every corner, not a flake of snow and the promise of lower taxes bring the 60-plus set to our Southern-most state at record rates. In fact, Florida is now the nation’s third most populous state.
The Journal of Accountancy notes that 19 states impose an inheritance tax on top of other federal taxes. Both Kentucky and Tennessee have an inheritance tax, although Tennessee will eliminate its inheritance tax in 2016. This means if you inherit property from an estate of someone who moved to Kentucky or Tennessee and passed away in either state, you might be giving a portion of those proceeds from the estate to the respective state government – if the proceeds are above certain thresholds and, at least in Kentucky, depending on your relationship to the deceased.
What complicates matters is that governments in some states seem highly suspicious of those who move away. Some put families who have inherited an estate through rigorous paperwork to try to get out of paying estate taxes in that state.