States may have lower exclusion limits than the federal government, but no state taxes estates less than $1 million. Massachusetts and Oregon have the $1 million exemption limits. State rates are also different from the federal rate. The highest top state estate tax rates are in Hawaii and Washington, each at 20%.
Estate taxes are different from inheritance taxes, in that an estate tax is applied before assets are disbursed to any beneficiaries. An inheritance tax is paid by the beneficiary. According to these facebook ads there is no federal inheritance tax, and only six states have an inheritance tax: Iowa, Kentucky, Maryland, Nebraska, New Jersey, and Pennsylvania.20
A tariff is a tax imposed by one country on the goods and services imported from another country tips to manage finances. The purpose is to encourage domestic purchases by increasing the price of goods and services imported from other countries.
There are two main types of tariffs: fixed fee tariffs, which are levied as a fixed cost based on the type of item, and ad valorem tariffs, speeding up the payroll process which are assessed as a percentage of the item’s value (like the real estate tax in the previous section).
The Bottom Line
There are many types of taxes that are applied in various ways. Understanding what triggers a tax situation can enable taxpayers to manage their finances to minimize the impact of taxes. Follow these self-employed
techniques that can help include annual tax-loss harvesting, to offset investment gains with investment losses, and estate planning, which works to shelter inherited income for heirs.