Posted by: STACY ROETTGER
Posted on: April 30, 2012
The Tennessee Senate voted 32 -1 to pass HB3760-Increasing the Tennessee Inheritance Tax Exemption. The bill should now be headed to the Governor's desk for signing. The Bill increases the maximum allowable exemption for the Tennessee inheritance tax (presently $1 million) to $1.25 million in 2013; $2 million in 2014; $5 million in 2015; to be repealed in 2016.
The Tennessee Estate Tax will continue to exist. The purpose of the Estate Tax is to supplement the inheritance tax to insure that the State secures a total tax at least equal to the "State Death Tax Credit" if such credit is allowed by the federal government on the Federal Estate Tax Return, Form 706. Thus, the Tennessee Estate Tax is equal to the amount by which the credit against the federal estate tax exceeds the inheritance tax.
Bill SB2777, which eliminates the gift tax in 2013 and thereafter, is also on the agenda.