Understanding Illinois Estate Tax
When someone dies, their estate may be subject to estate tax if the value of their assets is above a certain threshold. The Tax Cuts and Jobs Act of 2017 increased the threshold for federal estate tax from $5.49 million to $11.2 million. The exemption threshold for Illinois estate tax is currently $4 million. Any estate with a gross value that is more than this amount is subject to Illinois estate tax, with the full value of the estate being taxable.
The tax rates for the Illinois estate tax are variable, ranging from 0.8% to 16%. This tax applies not only to the value of an
Unlike the federal estate tax, the Illinois estate tax exemption cannot be passed to a person’s spouse after their death. However, some of the Illinois estate tax may be deferred if a spouse’s assets are placed in a qualified terminable interest property (QTIP) trust. This type of “credit shelter” trust can be used to defer the difference between the Illinois and federal estate taxes. For example, in estate tax returns filed for decedents who died in 2017, a QTIP election of up to $1.49 million may be made, and estate taxes on this amount will not apply until the death of the surviving spouse.
Contact an Arlington Heights Estate Planning Attorney
Understanding the relationship between federal and state estate taxes and determining how to manage assets in a way that minimizes tax burdens can be a complicated matter. If you want to be sure that you will be able to pass the assets you have earned throughout your lifetime to your heirs, the skilled attorneys of Drost, Gilbert, Andrew & Apicella, LLC can help you create an estate plan that meets your family’s needs. Contact our Schaumburg estate tax lawyers today at 847-934-6000 to schedule a personalized consultation.
About the Author: Attorney Jay Andrew is a founding partner of Drost, Gilbert, Andrew & Apicella, LLC. He is a graduate of the University of Dayton School of Law and has been practicing in estate planning, probate, trust administration, real estate law, residential/ commercial leasing, contracts, and civil litigation. Since 2005, Jay has been a Chair of the Mock Trial Committee for the Annual Northwest Suburban Bar Association High School Mock Trial Invitation which serves over 240 local Illinois students each year.