Iowa Inheritance Tax - A Thing of the Past in the Future?
It isn't uncommon to be discussing an estate plan with a client on beneficiaries of their estate plan and they will mention that they want to leave a gift to a sibling, or a nephew/niece, or a friend, or son-in-law, or their favorite estate planning attorney. (Okay, I made that last one up, but holding out hope...subject to ethical concerns.) And while we can certainly make a bequest to those individuals, I always give the disclaimer that there is an Iowa Inheritance tax that would need to be paid. Sometimes that prompts a few comments about taxes that aren't favorable to the Iowa tax system and fairness. Mainly because gifts to children are exempt already, so those individuals that were either unable to have their own children or chose to not have children feel slighted by the tax rules. But that looks to be coming to an end. The Iowa legislature recently passed a bill to repeal the Iowa Inheritance Tax. It is phased in with reductions for the...