Estate Planning

Illinois Estate Tax Exemptions and RatesIllinois' estate tax exemption will remain at $4,000,000 in 2021 with no adjustments for inflation. Like many states, their highest maximum estate tax is 16% and they do not offer portability for spouses.

But there's no federal or Illinois tax on inheritances.Illinoisans who inherit money or property, or receive it as a gift, are not taxed.

An inheritance tax is imposed on someone who actually receives an inheritance. But there's no federal or Illinois tax on inheritances. Some states do have inheritance taxes, but not Illinois. Illinoisans who inherit money or property, or receive it as a gift, are not taxed.

The Illinois estate tax rate is graduated and goes up to 16%. It is applied on estates worth more than $4 million.

Generally, only spouses, registered domestic partners, and blood relatives inherit under intestate succession laws; unmarried partners, friends, and charities get nothing.If there are no children, the surviving spouse often receives all the property.

If a person dies without a will, the person died intestate. The person who died is called the decedent. The decedent's property is given to the decedent's heirs during a probate court case.If the person had no spouse or children, then their property goes to their next closest surviving relatives.

Estate taxes should be paid within nine months after the death of the loved one. What about Illinois Estate Tax? Estates valued under $4 million do not need to file estate taxes in Illinois. For estates over $4 million, the tax rate is graduated with the upper level ($10.04 million and up) at 16 percent.

Illinois is one of only 12 states to still impose an estate tax. Six other states impose an inheritance tax on assets transferred from a deceased person's estate.

Ways to Reduce or Eliminate the Illinois estate tax: Use advanced gift and estate planning techniques. Life insurance planning. Assets left to a surviving spouse or civil union partner are exempt from the Illinois estate tax. Assets left to charity are exempt from the Illinois estate tax.