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The transfer of a deceased individual’s ownership interests in property, including real estate and personal property, may result in the imposition of inheritance tax. The amount of tax is determined by the value of those ownership interests that are transferred and the transferee’s relationship to the deceased individual – Class A, B or C. If the amount transferred to any one transferee exceeds their exemption amount, inheritance tax is due and an inheritance tax return will need to be filed.
The Indiana Department of Revenue’s Inheritance Tax Division works with individuals, tax professionals, assessors, attorneys, and financial institutions to understand what tax forms need to be prepared and filed and whether any inheritance tax is due.
Indiana’s inheritance tax was repealed for individuals dying after Dec. 31, 2012. No inheritance tax returns (Form IH-6 for Indiana residents and Form IH-12 for nonresidents) have to be prepared or filed. No tax has to be paid. In addition, no Consents to Transfer (Form IH-14) personal property or Notice of Intended Transfer of Checking Account (Form IH-19) are required for those dying after Dec. 31, 2012.
To view a letter the department sent attorneys and county assessors about the repeal, click here.
The 2013 legislature made some changes in the filing of refunds for inheritance tax. Under the new law, individuals will be required to file a refund claim on a Claim for Refund (Form IH-5) with the Indiana Department of Revenue. This new requirement applies to any claim for refund whether the individual died in 2013 or before. For more information about how to claim a refund, click here.
In general, estates or beneficiaries of Indiana residents are required to file an inheritance tax return (Form IH-6) with the appropriate probate court if the value of transfers to any beneficiary is greater than the exemption allowed for that beneficiary.
In general, estates or beneficiaries of deceased Indiana nonresidents are required to file an inheritance tax return (Form IH-12) with the Inheritance Tax Section of the Indiana Department of Revenue if the value of the transfers is greater than the exemption allowed for that beneficiary if the property transferred is Indiana real property and/or tangible personal property located in Indiana.
Exemptions are figured based on the relationship between the deceased individual and the beneficiary. Depending on the individual’s date of death the exemption amounts vary. For more information about exemptions, click here.
Consents to transfer securities or personal property (Form I-14), called by some financial institutions as a “tax waiver form,” (financial accounts - e.g. savings, CDs, IRA, annuities, investment accounts) and Notice of Intended Transfer of Checking Account (Form IH-19) are required for those dying before 1/1/2013. For more information about consents to transfer, click here.
Note that due to the complexities of inheritance tax, taxpayers do consult with attorneys or accountants who are familiar with Indiana’s inheritance tax to determine what forms, if any, should be prepared or filed. For more information check our list of inheritance tax forms at www.in.gov/dor/3509.htm. You can also contact the department by email or call 317-232-2154.
For individuals dying before January 1, 2013, the department has updated through May 23, 2014 Indiana’s death statutes, regulations and frequently asked questions that were a part of the 2011 Indiana Inheritance Tax Handbook published by the Probate, Trust and Real Property Section of the Indiana State Bar Association.