The Kentucky Inheritance Tax form is a crucial document required for reporting the inheritance tax due to the Commonwealth of Kentucky following a decedent's passing. This form serves to determine the tax liability based on the assets transferred to beneficiaries and whether any exemptions apply. Understanding how to accurately complete this form is essential for ensuring compliance with state tax laws.
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The Kentucky Inheritance Tax form is an essential document for the administration of estates in the Commonwealth of Kentucky. This form serves to report the inheritance tax due on the assets passed to beneficiaries following a decedent's death. If the date of death occurred on or after January 1, 2005, the appropriate forms must be utilized to ensure compliance with state tax laws. The primary forms include the Inheritance Tax Return (Form 92A200), which is required when assets are passed to taxable beneficiaries, and the Inheritance Tax Return Short Form (Form 92A205), designed for simpler estates with fewer than ten items. For estates where no inheritance tax is owed, the No Tax Due Return (Form 92A201) can be submitted, provided that all assets pass to exempt beneficiaries, such as spouses or children. Additionally, if all taxable assets are transferred to exempt beneficiaries and a Federal Estate and Gift Tax Return is not necessary, an Affidavit of Exemption can be filed to conclude the estate's administration without submitting an Inheritance Tax Return. The Kentucky Department of Revenue oversees the collection of these taxes, aiming to administer tax laws fairly and efficiently for the benefit of its citizens. Understanding the nuances of these forms and their requirements is crucial for executors and beneficiaries alike, as it impacts the timely and accurate settlement of estates.
Kentucky
Inheritance and Estate Tax
Forms and Instructions
COMMONWEALTH OF KENTUCKY
DEPARTMENT OF REVENUE
For Dates of Death on or After January 1, 2005
(Revised February, 2018)
Kentucky Department of Revenue
Mission Statement
As part of the Finance and Administration Cabinet, the mission of the Kentucky Department of Revenue is to administer tax laws, collect revenue, and provide services in a fair, courteous, and efficient manner for the benefit of the Commonwealth and its citizens.
* * * * * * * * * * * * *
The Kentucky Department of Revenue does not discriminate on the basis of race, color, national origin, sex, age, religion, disability, sexual orientation, gender identity, veteran status, genetic information or ancestry in employment or the provision of services.
NOTICE
If all taxable assets pass to exempt beneficiaries and a Federal Estate and Gift Tax Return is not required, it is not necessary to file an InheritanceTax Return with the Kentucky Department of Revenue. An affidavit of exemption will be accepted for the final settlement and closing of the administration of an estate. If inheritance tax is due the Commonwealth of Kentucky, Form 92A200 or 92A205 should be used.
The affidavit of exemption is to be filed only with the court. Do not send a copy of the affidavit to the Kentucky Department of Revenue.
Sample Affidavit of Exemption
AFFIDAVIT OF EXEMPTION
Affiant ____________________________ , being first duly sworn, states that he/she is fiduciary or beneficiary of the
estate of _______________________________ , who died on the _______ day of __________________ , _______ , a resident
of _________________________ County, Kentucky.
Affiant states that all assets of the estate pass to exempt beneficiaries pursuant to Kentucky Revised Statute 140.080* or exempt organizations pursuant to Kentucky Revised Statute 140.060** either by virtue of the decedent’s will, the intestate laws of this state, or by contract (survivorship, payable on death, trust, etc.).
Affiant further states that a Kentucky Inheritance Tax Return will not be filed since no death tax is due the state and a Federal Estate and Gift Tax Return (Form 706) is not required to be filed because the gross estate is less than the required amount set out in Section 2010(c) of the Internal Revenue Code. This affidavit is being submitted to satisfy the requirements of Kentucky Revised Statute 395.605.
__________________________________________________________
Signature
Witness my hand this ________ day of __________________________ , __________ .
Sworn and subscribed to before me by _____________________________________
this _______ day of ____________________________________________ , __________ .
______________________________________________________ Notary Public
My commission expires______________________________________
*Exempt beneficiaries under KRS 140.080 include spouse, children, stepchildren, grandchildren, parent, brother, and sister.
**Exempt organizations include educational, religious or other institutions, societies, or associations, whose sole purpose is to carry on charitable, educational, or religious work. Also, cities, towns or public institutions in this state qualify as exempt organizations provided that any transfer to such an organization is for public purposes.
WHAT’S INCLUDED
INHERITANCE AND ESTATE TAX FORMS
No Tax Due Return (resident and nonresident) and Instructions (Form 92A201) Inheritance Tax Return (resident and nonresident) (Form 92A200)
Inheritance Tax Return (short form) (resident and nonresident) (Form 92A205) Real Estate Valuation Information Form (Form 92A204)
Election to Qualify Terminable Interest Property and/or Power of Appointment Property (Form 92A936) Election to Defer the Payment of Inheritance Tax Through Installments (Form 92A928)
Affidavit of Exemption (Form 92A300) Inheritance Tax Table for Resident Decedent Inheritance Tax Table for Nonresident Decedent Blanket Consent
GENERAL INFORMATION
Supplemental Documents
1
Payment of Tax
Discount
Installment Payments
Interest
Penalties
Property to be Included on the Return
Valuation of Property—Fair Cash and Agricultural
2
Deductions
Federal Estate Tax
Qualified Terminable Interest Property (QTIP) and/or Powers of Appointment (POA)
Property Previously Taxed
Example of Credit for Previously Taxed Property
3
Distribution
4
Exemptions for Beneficiaries of a Resident Decedent
Exemptions for Beneficiaries of a Nonresident Decedent
5
Bequest of Tax
Property Set Aside Under KRS 391.030(1)(c)
Estate Tax
5 & 6
Value of a Life Estate
6
Amended Return
7
Acceptance Letter
Protest and Appeal
Helpful Hints
Where to Obtain Assistance
Reporting of Intangible Property Tax
Fiduciary Return
Office of the Taxpayer Ombudsman
Website for Forms
Definitions
8 & 9
Taxpayer Service Centers Locations and Phone Numbers
10
Kentucky Taxpayers Bill of Rights
inside back cover
INHERITANCE AND ESTATE TAX FORMS IN THIS PACKET
The forms in this packet should only be used if the date of death occurred on or after January 1, 2005.The forms may be dupli- cated on a computer and the space allocated for each item may be decreased or increased depending on the amount of space required. The forms may be used for a decedent who was a resident or a nonresident of Kentucky.
If all taxable assets pass to exempt beneficiaries and a Federal Estate and Gift Tax Return is not required, it is not neces- sary to file an Inheritance Tax Return with the Kentucky Department of Revenue (DOR). An Affidavit of Exemption will be accepted for the final settlement and closing of the administration of an estate. If inheritance tax or estate tax is due the Commonwealth of Kentucky, Form 92A200 or 92A205 should be used.
If the date of death occurred prior to January 1, 2005, contact the Financial Tax Section, Department of Revenue, Station 61, 501 High Street, Frankfort, KY 40601-2103, (502) 564-4810, fax (502) 564-2695.
Three forms are included in this booklet. Choose one unless an Affidavit of Exemption is used.
1.No Tax Due Return (Form 92A201)
This return may be used for an estate (Kentucky resident or nonresident) if: (1) there is no Kentucky inheritance tax due, (2) the date of death is on or after January 1, 2005, and (3) the entire estate passes to beneficiaries listed in the following group either by contract (survivorship, payable on death, trust, etc.), the decedents will, or the intestate laws of this state:
(1)Surviving spouse, parent
(2)Child (adult or infant)
child by blood, stepchild, child adopted during infancy, or child adopted during adulthood who was reared by the decedent during infancy
(3) Grandchild
issue of child, stepchild, child adopted during infancy, or of a child adopted during adulthood who was reared by decedent during infancy
(4) Brother, sister (whole or half)
Refer to KRS 140.080 for (1) through (4) above
(5) Exempt organizations—Refer to KRS 140.060
Exempt organizations include educational, religious or other institutions, societies, or associations, whose sole purpose is to carry on charitable, educational, or religious work. Also, cities, towns or public institutions in this state qualify as exempt organizations provided that any transfer to such an organization is for public purposes.
2.Inheritance Tax Return (Form 92A200)
This return must be used for an estate (resident or nonresident) when: (1) the date of death is on or after January 1, 2005, and (2) any assets of the estate pass to taxable beneficiaries or taxable organizations, or when Forms 92A201 and 92A205 do not apply.
Instructions are on the back of each schedule.
3.Inheritance Tax Return (Short Form) (Form 92A205)
This return may be used for an estate (Kentucky resident or nonresident) when : (1) a federal estate tax return is not re- quired to be filed, (2) the assets of the estate consist of 10 items or less, (3) no gifts or transfers where made within three years of death without full consideration, (4) no real or personal property was transferred with a retained life interest, (5) the decedent did not possess any power to appoint any real or personal property or have the use of any qualified terminable interest property, and (6) the decedent had not received any real or personal property from another decedent within five years and paid inheritance tax on the property.
92A201 (6-16)
Commonwealth of Kentucky
Kentucky Inheritance
Tax Return
NO TAX DUE
FOR DEPARTMENT USE ONLY
__ __ __ __ __ __ / __ __ / __ __ / __ __ __ __
Account Number
Tax
Mo
Year
This return may be used if: (1) there is no Kentucky inheritance tax due, (2) the date of death is on or after January 1, 2005, and
(3)the entire estate passes to beneficiaries listed in the following groups either by contract (survivorship, payable on death, trust, etc.), the decedent’s will, or the intestate laws of this state:
child by blood, stepchild, child adopted during infancy,
or a child adopted during adulthood who was reared by decedent during infancy
(3)Grandchild
issue of child by blood, stepchild, child adopted during infancy,
or of a child adopted during adulthood who was reared by decedent during infancy
(4)Brother, sister (whole or half)
Refer to KRS 140.080 for (1) through (4) above
(5)Exempt organizations—Refer to KRS 140.060
Decedent’s Name Last
First
Middle Initial
Date of Death
Social Security Number
Occupation (If decedent was retired
Age at Death
Cause of Death
HR Code Number (if known)
at death, state occupation prior to
retirement.)
Residence (Domicile) at Time of Death
Number and Street
City
State
ZIP Code
County
Name and Address of Executor/Administrator/Beneficiary
Name and Address of Preparer
Exec
Atty
Admr
CPA
________
Did the decedent have a will? No Yes If Yes, attach a copy of the will.
Did the decedent have a trust agreement? No
Yes If Yes, attach a copy of the trust agreement.
Filing status of Federal Estate and Gift Tax Return for this estate (check one):
Not Required
Required (enclose copy)
Not Required, but filed for Portability (enclose copy)
Schedules for listing property (real and personal) and beneficiaries are on the reverse side of this form. Listing of property is optional. Listing of beneficiaries and their relationship is required.
Total Value of Property from Reverse Side
(optional) $
Under criminal penalties, I declare that this return, including accompanying documents, has been examined by me, and is, to the best of my knowledge and belief, true, correct and complete.
(
)
Signature of Executor/Administrator/Beneficiary
Date
Telephone Number
E-mail Address
Signature of Preparer
Mail to: Kentucky Department of Revenue, Frankfort, Kentucky 40620
PART I—PROPERTY (Optional Listing)
Description and Location
of Real or Personal Property
Fair Cash Value at Date of Death
Total Value of Property
PART II—BENEFICIARIES (Must be completed)
$
Name of Beneficiary
Relation to Decedent (Required)
If all taxable assets pass to exempt beneficiaries and a Federal Estate and Gift Tax Return is not filed, it is not necessary to file an InheritanceTax Return with the Kentucky Department of Revenue. An affidavit of exemption will be accepted by the courts for the final settlement and closing of the administration of an estate. If inheritance tax is due the Commonwealth of Kentucky, Form 92A200 or 92A205 should be used.
92A200 (6-16)
KENTUCKY
INHERITANCE TAX RETURN
Requirements for use of this return—This return is to be filed when (1) the date of death is on or after January 1, 2005, (2) any assets of the estate pass to taxable beneficiaries or taxable organizations, (see page 4 of general information) and (3) Forms 92A201 and 92A205 do not apply. Pursuant to KRS 140.190, the beneficiaries as well as the personal representative(s) may be held personally liable for the tax.
Return Status (check one):
Original Return
Amended Return—Refund
Amended Return—Tax Due
Decedent’s Name
Last
Occupation (If decedent was
retired at death, state occu-
pation prior to retirement.)
HR Code Number
Did the decedent have a will? No
Yes
If Yes, attach a copy of the will.
If Yes, attach a copy of the trust agreement.
Gross Estate
1.
Individually owned assets
2.
Jointly owned assets
3.
Qualified terminable interest property
and/or powers of appointment
4.
Previously taxed property
5.
Gifts and transfers
Total Gross Estate
6.
Funeral expenses
7.
Administration expenses
......................................................................
8.
Debts of decedent
9.
...................................Federal estate tax— paid or estimated
Total Deductions
Net Estate (Total Gross Estate less Total Deductions)
Total Tax Due from Tax Computation Form 92A200
Interest and Penalty
10.
Interest for late payment (see general information)
....................................................................
11.
Late filing penalty (see general information)
12.
Late payment penalty (see general information)
13.
Total Due (tax plus interest and penalties, if applicable)
14.
Total previously paid
15.
Balance due/Refund
Attach check payable to “Kentucky State Treasurer” to this return and mail to Kentucky Department of Revenue, Frankfort, KY 40620
( )
E-mail Address of Executor/Administrator/Beneficiary
Estate of:
Individually Owned Assets
Page ____ of ____
List in this schedule all items individually owned by the decedent including life insurance payable to the estate.
(Please review instructions on reverse side for details.)
Item
Description of Property/Name of Corporation
Accrued Rents/
Number
Fair Cash Value
or Obligor/ Name of Bank or Debtor
Interest/Dividends
of Shares
on Date of Death
Total (including continuation page(s)) (enter on page 1, line 1)
If additional space is needed, duplicate this page and attach as a continuation page(s).
INSTRUCTIONS
INDIVIDUALLY OWNED ASSETS
All real proper t y individually owned must b e lis ted in this schedule . For re por ting agricultural or horticultural land, see General Information—Valuation of Property—Fair Cash and Agricultural.
Stocks and bonds individually owned are includable in this schedule. Stock values are determined by using an average of the high and low quoted selling price on the decedent’s date of death. In case of inactive stock such as closely held corporations, explain the method used in computing the value at the date of death. A balance sheet, at a date nearest the decedent’s death, together with a statement of net earnings and dividends paid for the five-year period immediately preceding the date of death, must be supplied in support of these valuations (ex. financial institution’s monthly statement.)
Dividends declared and of record in the decedent’s name but not paid prior to death must be included in this schedule. Provide statements, lists, etc. supporting valuation of these assets.
United States bonds individually owned as well as those payable upon death to another should be included in this schedule. Indicate series, maturity value and date of purchase of all United States bonds.
In some instances, the estate will include stocks and bonds listed on a stock exchange that did not make sales on the date of the decedent’s death. When this occurs, their value must be determined by averaging the high and low for the last working day preceding the date of death and the first working day subsequent to the date of death. For reporting stock of a corporation owning qualified real estate passing to a qualified person(s), see General Information—Valuation of Property—Fair Cash and Agricultural.
Mortgages, notes and cash individually owned must be listed in this schedule. List accrued interest to date of death. The description of mortgages and notes must include interest rate, the date the last payment of interest was made preceding the date of the decedent’s death, and the due date
of the mortgages or notes. If an account is held out of state, show name and address of financial institution on the tax return.
List life insurance payable to the insured or to the estate. Life insurance payable to a designated beneficiary, including a testamentary or inter vivos trustee, is tax-free.
List in this schedule other individually owned items of the gross estate, such as debts due decedent; business or partnership (attach balance sheet showing capital accounts); claims, exclusive of those claimed under KRS 411.130 (wrongful death); rights; royalties; leaseholds; judgments; shares in trust funds; contracts; household goods and personal effects, including antiques, jewelry and collections of any type; farm products and growing crops; livestock; farm machinery; automobiles; etc.
The value of an annuity or other payment made to a beneficiary of a deceased employee (other than the executor or equivalent) under (1) an exempt trust or qualified nontrusted annuity plan as described by the Internal Revenue Code or (2) a contract purchased by an educational or charitable organization as referred to in Section 170(b)(1)(A)(ii) or (vi) of the Internal Revenue Code or a religious organization exempt from tax under Internal Revenue Code Section 501(a), is taxable in the proportion that the total contributions made by the decedent bears to the total contributions made. The proceeds from a Retired Serviceman’s Family Protection Plan or Survivor Benefit Plan are exempt under KRS 140.015(2). Refer to KRS 140.063(3) and (4) regarding the taxation of individual retirement accounts and annuities as described in Section 408(a) and (b) of the Internal Revenue Code. Lump-sum distributions of an IRA are taxable.
All other annuities, including deferred compensation plans, or payments other than those described in the preceding paragraph made to a beneficiary, executor or equivalent, are fully taxable if the decedent retained ownership at death such as the right to name or change the beneficiary and must be listed in this schedule.
Filling out the Kentucky Inheritance Tax form requires careful attention to detail. Once the form is completed, it should be submitted to the Kentucky Department of Revenue for processing. Below are the steps to guide you through filling out the form correctly.
The Kentucky Inheritance Tax is a tax imposed on the transfer of property from a deceased person to their beneficiaries. The tax rate varies depending on the relationship between the deceased and the beneficiary. Spouses and certain relatives may be exempt or subject to lower rates.
The form must be filed within 15 months of the date of death. If the tax is due, payment must also be made by this deadline to avoid penalties and interest. If all assets are exempt, an affidavit of exemption can be submitted instead.
The Inheritance Tax form is required if any taxable assets are passed to beneficiaries who do not qualify for exemptions. If all assets pass to exempt beneficiaries, then filing may not be necessary. A Federal Estate and Gift Tax Return may also determine the need for filing.
There are several forms available, including:
Each form serves a specific purpose based on the estate's circumstances and the beneficiaries involved.
An Affidavit of Exemption is a document that states all assets of the estate pass to exempt beneficiaries. This affidavit can be submitted for the final settlement of the estate, eliminating the need to file a formal Inheritance Tax Return if no tax is due.
If the Inheritance Tax is not paid by the deadline, the estate may incur penalties and interest. Additionally, the Kentucky Department of Revenue may take legal action to collect the owed tax. It is essential to address any tax obligations promptly to avoid complications.
Yes, certain beneficiaries are exempt from the Kentucky Inheritance Tax. These include spouses, children, stepchildren, grandchildren, parents, and siblings. Additionally, some organizations, such as educational or charitable institutions, may also qualify for exemptions.
The Kentucky Inheritance Tax forms can be obtained from the Kentucky Department of Revenue's website or by visiting their office. It is important to use the correct forms based on the date of death and the specific situation of the estate.
Incorrect Form Selection: Many people mistakenly choose the wrong form. Ensure you select the appropriate form based on whether there is inheritance tax due or if an affidavit of exemption is applicable.
Incomplete Information: Failing to fill out all required fields can delay processing. Double-check that all necessary details about the decedent and beneficiaries are provided.
Missing Attachments: Some individuals forget to include necessary documents, such as a copy of the will or trust agreement. Attach all required documents to avoid complications.
Incorrect Beneficiary Designation: Listing beneficiaries inaccurately can lead to issues. Ensure that all beneficiaries are correctly identified and their relationships to the decedent are clearly stated.
Failure to Sign: A common oversight is neglecting to sign the form. Both the executor and the preparer must provide their signatures to validate the submission.
Ignoring Deadlines: Submitting the form late can result in penalties. Be aware of filing deadlines and ensure timely submission to avoid unnecessary fees.
The Kentucky Inheritance Tax form is often accompanied by various other documents to ensure proper administration of an estate. Below is a list of common forms and documents that may be required or beneficial in conjunction with the Kentucky Inheritance Tax form.
Each of these documents plays a crucial role in the estate administration process and helps ensure compliance with Kentucky tax laws. Properly completing and submitting these forms can prevent delays and complications during the settlement of an estate.
The Kentucky Inheritance Tax form shares similarities with the Federal Estate Tax Return (Form 706). Both documents serve to report the assets of a deceased individual and determine any taxes owed. While the Kentucky form focuses specifically on state inheritance taxes, the Federal form assesses federal estate taxes. Both require detailed information about the decedent's assets, liabilities, and beneficiaries, and they must be filed within a specific timeframe following the death of the individual.
Another document comparable to the Kentucky Inheritance Tax form is the Last Will and Testament. This legal document outlines how a decedent wishes their assets to be distributed after death. While the will itself does not calculate taxes, it plays a crucial role in determining the beneficiaries and the distribution of the estate, which directly impacts the inheritance tax calculations on the Kentucky form.
The Affidavit of Exemption is also similar to the Kentucky Inheritance Tax form. This affidavit allows certain estates to bypass the inheritance tax return if all assets pass to exempt beneficiaries. Like the Kentucky form, it requires specific information about the decedent and the beneficiaries but is used in situations where no tax is due, simplifying the process for qualifying estates.
The Probate Court Filing is another document relevant to the inheritance tax process. This filing is necessary to initiate the legal process of administering an estate. The probate court oversees the distribution of assets according to the will or state law. The outcomes of this process can influence the information reported on the Kentucky Inheritance Tax form, particularly regarding the validity of the will and the status of beneficiaries.
The Estate Inventory is similar in that it provides a detailed listing of the decedent's assets. This inventory is often required during the probate process and must include the value of all property owned by the decedent at the time of death. This information is critical for accurately completing the Kentucky Inheritance Tax form, as it directly affects the calculation of any taxes owed.
The Gift Tax Return (Form 709) also bears resemblance to the Kentucky Inheritance Tax form. While the gift tax return is used to report gifts made during a person's lifetime, both documents assess the transfer of wealth. The information on the gift tax return may be relevant for determining the overall value of the estate and any potential tax implications that could arise from previous gifts made by the decedent.
The Federal Tax Return (Form 1040) can be compared to the Kentucky Inheritance Tax form as well. Although the federal return is focused on income tax, it may include information about the decedent’s financial situation that can impact the estate's value. Understanding the decedent's income and financial activities can provide context for the assets reported on the Kentucky form.
The Power of Attorney document is another relevant form. While it primarily grants authority to another individual to act on behalf of the decedent during their lifetime, it can influence the administration of the estate after death. If a power of attorney was in place, it may affect how assets were managed and subsequently reported on the Kentucky Inheritance Tax form.
Lastly, the Estate Tax Return (for states other than Kentucky) can also be seen as similar. While each state has its own tax laws, many states have forms that assess taxes on estates. These forms require similar information about the decedent's assets and beneficiaries, making them comparable to the Kentucky Inheritance Tax form in terms of purpose and structure.
When filling out the Kentucky Inheritance Tax form, it’s important to follow certain guidelines to ensure the process goes smoothly. Here’s a list of what to do and what to avoid:
The following are common misconceptions regarding the Kentucky Inheritance Tax form:
Understanding the Kentucky Inheritance Tax form is crucial for beneficiaries and fiduciaries. Here are ten key takeaways to consider: