I have heard the term “inheritance tax.” Is this just another way of referring to an estate tax?
Many people make this assumption, but in fact, they are two different types of taxes. As we have stated, an estate tax is applied on the entirety of the taxable portion of an estate before it is transferred to the heirs.
An inheritance tax is applicable on each individual transfer, so there can be multiple impositions of this tax when one estate is being administered. Fortunately, you do not have to be concerned about an inheritance tax if you live in Ohio.
There is no federal inheritance tax, and just six states have state-level inheritance taxes. The Buckeye State is not one of them, so people here are in the clear.