As we all know Oklahoma City is a great place to live on a number of different levels. One of the advantages that we enjoy from an estate planning perspective is the fact that there is no estate tax on the state level in Oklahoma.
Given the fact that there is a federal estate tax in place that carries a 35% maximum rate (which is rising to 55% next year) this is certainly a huge positive. We did have a state estate tax to contend with through 2009 but a repeal ended the tax from 2010 onward.
A lot of people feel as though this is quite fair because of the fact that the estate tax, whether it is imposed on the state or the federal level, is a tax on money that is left over after you paid taxes on the income.
Critics refer to the estate tax as the death tax because of the fact that the only thing that happened to trigger the tax was the passing of the individual in question. Those who question the fairness of the tax wonder why the event of your death should be treated as taxable income. A supporting view is that the tax system should not punish you for financial success. Of course, opponents disagree. They feel that an estate tax helps open up our system, levels the playing field, provides a source of revenue for government programs and gives each generation a “fresh start.”
Though there is no estate tax or inheritance tax on the state level here in Oklahoma, you would do well to 1) understand the fact that these taxes do exist in other states and 2) be fully educated on the impact of the federal estate tax on you. So, if you are considering relocating after you retire you may want to check into the tax laws in the state you are considering moving to before making a final decision.
Author, President and Founding Attorney
Parman & Easterday
- Founding Attorney, Larry Parman, Shares a Personal and Insightful Message about the Coronavirus Situation and How the Firm is Handling It (click on the video below) - March 27, 2020
- Understanding Estate Planning – Developing a Fair Inheritance Plan - March 26, 2020
- Use Trust Protectors for Added Protection and Flexibility - March 25, 2020