IBJNews

Indiana House votes to phase out inheritance tax

Back to TopCommentsE-mailPrintBookmark and Share

The Indiana House on Tuesday approved a 10-year phase-out of the state's inheritance tax that now brings in about $160 million a year.

House members voted 80-17 in favor of the plan that would more than double the current inheritance tax exemption for children and grandchildren to $250,000 and reduce the tax rate each year until 2022.

Republican Rep. Eric Turner of Cicero, the bill's sponsor, said eliminating the tax would help families keep small businesses and farms. He said it the current system is unfair because it taxes assets that a person had accumulated from their taxed income.

"You've already paid taxes on this money," Turner said.

The phase-out period will help the state afford the revenue losses, estimated to be about $60 million the first year and then an additional $10 million each year until the tax is eliminated, Turner said. Inheritance taxes currently account for about 1 percent of state revenue.

Opponents of phasing out the tax argued is the wrong step to take when budget leaders previously have said the state can't afford the estimated $60 million annual cost to eliminate school textbook fees or allow less-expensive moves such as removing the state's 7 percent sales tax on college textbooks.

"Every year it's, 'Sorry, gee we just don't have the money, it'd really be nice to do that,'" said Rep. Matt Pierce, D-Bloomington.

The state now exempts inheritances of less than $100,000 to children and grandchildren and has a top rate of 10 percent for portions of estates topping $1.5 million. More distant family members and non-relatives face higher rates. Spouses pay no state inheritance taxes.

The new exemption level for close relatives under the House plan would be $250,000, with a $25,000 exemption for others. The plan starts phasing out the tax on estates for those who die after July 1.

Senate budget leaders largely support the House's inheritance tax elimination plan but agreement must be reached on a final version by the end of next week, when legislative leaders expect to adjourn this year's session.

ADVERTISEMENT

  • Inheritance Tax
    It seems that we could have gone "cold turkey" on the inheritance tax, adding an offset tax to alcohol, tobacco, and firearms.

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in IBJ editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by
ADVERTISEMENT

facebook - twitter on Facebook & Twitter

Follow on TwitterFollow IBJ on Facebook:
Follow on TwitterFollow IBJ's Tweets on these topics:
 
Subscribe to IBJ
  1. why oh why does this state continue to elect these people....do you wonder how much was graft out of the 3.8 billion?

  2. i too think this is a great idea. I think the vision and need is there as well. But also agree with Wendy that there may be better location in our city to fulfill this vision and help grow the sports of hockey and figure skating in Indy. Also to help further develop other parts of the city that seem often forgotten. Any of the other 6 townships out side of the three northernmost could benefit greatly from a facility and a vision like this. For a vision that sounds philanthropic, the location is appears more about the money. Would really like to see it elsewhere, but still wish the development the best of luck, as we can always use more ice in the city. As for the Ice growth when they return, if schedules can be coordinated with the Fuel, what could be better than to have high level hockey available to go see every weekend of the season? Good luck with the development and the return of the Ice.

  3. How many parking spaces do they have at Ironworks? Will residents have reserved spaces or will they have to troll for a space among the people that are there at Ruth Chris & Sangiovese?

  4. You do not get speeding ticket first time you speed and this is not first time Mr.Page has speed. One act should not define a man and this one act won't. He got off with a slap on the wrist. I agree with judge no person was injured by his actions. The state was robbed of money by paying too much rent for a building and that money could have been used for social services. The Page family maybe "generous" with their money but for most part all of it is dirty money that he obtained for sources that are not on the upright. Page is the kind of lawyer that gives lawyers a bad name. He paid off this judge like he has many other tine and walked away. Does he still have his license. I believe so. Hire him to get you confiscated drug money back. He will. It will cost you.

  5. I remain amazed at the level of expertise of the average Internet Television Executive. Obviously they have all the answers and know the business inside and out.

ADVERTISEMENT