Why is there so much opposition to an equal distribution of wealth? How is inheritance tax in America? Here are the details Achi-News

New Delhi: Even as the Lok Sabha Election 2024 is at its peak in the country, the discussion on equal distribution of wealth has come to the fore. The BJP has opposed the Congress on the promise of distribution of wealth in the Congress manifesto, meanwhile the statement of the opposition Sam Pitroda has been heavily discussed. BJP has come out against Congress like Prime Minister Narendra Modi against paternal property tax issue.

What did Sam Pitroda say?

Senior Congress leader Rahul Gandhi had recently stated that if his government came to power in the elections, a survey would be conducted to find out who owns how much property. When Sam Pitroda was asked about his statement, he mentioned the current inheritance tax in America.

Regarding this, Pitroda said, America has an inheritance tax. He said if a person owns a property worth 40 acres of land, after his death, 45% of the property will be transferred to his children and 55% of the property will be taken over by the government and to give to the disadvantaged and the poor. Also, Pitroda said this is an interesting law. Under this law, there is a provision that you have created enough wealth during your life and after your death, your wealth should be left to the public. He said that the whole property, but half is given, which seems right to me.

Sam Pitroda, who spoke further, said, ‘But there is no such law in India. If someone here has assets worth 10 thousand crores. After his death, all his property goes to his children, the poor, the general public gets nothing. I think people should discuss such things. I do not know what the outcome of this discussion will be. We are talking about new policies and new programmes, which should benefit the people, not the rich, he said.

The Congress distanced itself from Pitroda’s statement

Meanwhile, the Congress has kept its distance from Pitroda’s statement. Congress leader Jairam Ramesh said that every person has the freedom to express his opinion in a democracy, but that does not mean that Pitroda’s opinion always coincides with that of the Congress.

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Inheritance tax in America!

But, amid political troubles, the question of what inheritance tax is and how much tax is charged by whom has now arisen. In fact, inheritance tax is levied on the distribution of assets after a person’s death. Inheritance tax is collected in six US states. How much does this tax cost? It depends on where the deceased lived and his relationship with the heirs.

What is Inheritance Tax?

In America, there is no inheritance tax at the central level. This tax is only levied in six states – Iowa, Kentucky, Maryland, Nebraska, New Jersey and Pennsylvania. However, there is news that this tax will be abolished in Iowa by 2025. Tax rates are different in each state.

Iowa: Inheritance tax here varies from 1 to 4%. Spouses, children, step-children, parents, grandparents, grandchildren, great-grandchildren and great-great-grandchildren are exempt from the tax. Apart from these, if the deceased makes someone else the heir of his property, he will have to pay inheritance tax. If the property is donated to charity, a deduction of up to $500 is available.

Kentucky: In this state, tax is charged on the basis of relationship with the deceased. If the property is worth more than a thousand dollars it is taxed at 4% to 16%. Spouses, parents, children, stepchildren, grandchildren and siblings are exempt from tax.

Maryland: If the property is worth more than a thousand dollars, then a 10% tax is payable. Spouses, children, parents, grandparents, grandchildren, siblings and charitable organizations are exempt from this. Maryland is a state that requires an estate tax as well as an inheritance tax.

Nebraska: Here the tax rate varies depending on the relationship of the deceased. Parents, children, siblings and grandparents pay a 1% tax on assets worth more than $100,000. Uncles, aunts, nephews and nieces are taxed at 11% on estates over $40,000. However, all other heirs must pay a 15% tax on estates over $25,000. All heirs under the age of 22 are exempt from tax.

New Jersey: Inheritance tax here varies from 11% to 16%. Spouses, children, parents, grandparents, grandchildren and charities are exempt. Siblings and sons and daughters-in-law are exempt from estates worth $25,000.

Pennsylvania: Tax rates are also different in these states. All heirs must pay tax on estates worth more than three and a half thousand dollars. Parents, children and grandparents pay 4.5% tax, siblings 12% and remaining heirs 15%. No tax for heirs under 21 years of age.

Also Read: Lok Sabha Election: Congress spoils you not only when you are alive, but also when you are dead; Modi thundered against inheritance tax

Estate tax is also charged

In America, there is no inheritance tax at the federal level, but estate tax applies throughout the country. In states where inheritance tax applies, the deceased’s heirs must also pay estate tax along with it.

The estate tax rate in the United States is 15% to 20%. Until last year, estate taxes were payable on estates of $12.9 million or more. Starting this year, estate taxes will be payable on estates of $13.6 million or more.

Ways to Avoid Inheritance Tax

There is also a way to avoid inheritance tax. Inheritance tax can only be avoided if you distribute the property before death.

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