Connecticut has no inheritance tax but it does have its own estate tax. There may also be additional federal taxes that your estate must pay. In this article, we break down the Constitution State’s inheritance laws, including what happens if you die without a valid will, probate, what makes a will valid and more. If you want professional guidance for your estate planning then you may want to consider working with a financial advisor.
Does Connecticut Have an Inheritance Tax or an Estate Tax?
Connecticut has no inheritance tax, but it does have its own estate tax, which is in addition to the federal estate tax and affects Connecticut residents and those who own property in the state but live elsewhere.
While the vast majority of families aren’t affected by the federal estate tax (because of how high the exemption is), Connecticut’s estate tax affects a greater proportion of estates. For estates of people who died in 2019, an estate won’t have to file a Connecticut estate tax return if the value of the estate is less than $3.6 million. For estates of people who die in 2020, the estate won’t have to file a state estate tax return if the estate is worth less than $5.1 million. The estate tax is due within six months of the estate owner’s death, though a six-month extension may be requested.
The estate tax rate is progressive and payable on the value of the entire taxable estate. The tax rate ranges from 7.8% to 12%. Finally, Connecticut caps the total amount of an estate tax at $15 million.
Other Necessary Tax Filings
When you die, there are many federal and estate tax situations that need to become a priority for those who survive you. Besides the state estate tax, you need to look out for the following:
- Final individual federal and state income tax returns: The federal and state tax returns are due by Tax Day of the year following the individual’s death.
- Federal estate/trust income tax return: Due by April 15 of the year following the individual’s death
- Federal estate tax return: Due nine months after the individual’s death, though an automatic six-month extension is available if asked for prior to the conclusion of the nine-month period. This is required only of individual estates that exceed a gross asset and prior taxable gift value of $11.58 million in 2020
To file any of these estate-based returns, you’ll need to apply for an employer identification number (EIN) with the IRS. You can do this online, by fax or via mail.
Dying With a Will in Connecticut
For a will to be valid in Connecticut, you must sign your will in front of two witnesses, and those witnesses must sign your will in front of you. Although you do not need a notary to make your will legal, a notary can allow you to make your will “self-proving.” A self-proving will speeds up the probate process because the court can accept the will without needing to contact the witnesses who signed the will. To make the will self-proving, you and your witnesses must each go to the notary and sign an affidavit proving who you are and that you know you were signing the will.
Once the will is determined to be valid, the next step is the probate process. Generally, probate proceedings are only necessary if the deceased person owned any assets in their name only. Other assets, also known as “non-probate” property, can usually be transferred to the other owner without probate.
Connecticut, which is not a Uniform Probate Code state, offers a simplified probate process for smaller estates. In order to qualify for the simplified process, there must be no real estate, except real estate held in survivorship form, and the estate cannot exceed $40,000 in value. To use this process, the executor files a written request to use the simplified procedure with the local probate court. The court can then allow the executor to distribute the property without going through regular probate.
You must fill out an affidavit that states whether the deceased person received aid or care from the state, a list of deceased person’s probate assets, and a list of all claims, expenses, and taxes due and whether they have been paid and who paid them. The court will send a copy of the affidavit to the Department of Administrative Services. The court determines who will receive the remaining assets of the estate. Whoever has the asset transfers it to the person designated by the court, pays a specified amount to the person, or sells the assets in question and gives the proceeds to the person designated by the court.
The court will also decide which, if any, of the following claims should be paid from the estate in the following priority order:
- Funeral costs
- Costs of administering the estate
- Medical expenses of the final illness
- Taxes and claims from the state of Connecticut
- Unpaid employee wages or payments due to a mechanic from the three months before the death
- Other preferred claims
Dying Without a Will in Connecticut
Dying without a will isn’t the best situation if what happens to your assets after your death matters to you. Connecticut laws label these types of estates “intestate,” which means there is no will or no valid will. The court then has to follow intestate succession laws to determine who inherits your property, and how much of it.
If there isn’t a will, someone must be appointed by the probate court as an executor or personal representative, usually the surviving spouse or an adult child. The executor or personal representative takes care of the estate of the decedent.
Although there are often extenuating factors when someone dies intestate, it’s best not to die intestate and put your loved ones through that kind of stress. If you’re not sure what kind of estate plan you want to make, you can seek the help of a financial advisor specializing in legacy planning.
Connecticut Inheritance Law for Spouses
If you die intestate in Connecticut, what your spouse inherits depends on whether or not you have living parents or descendants. If you don’t, your spouse inherits everything. If you have living parents, and a surviving spouse, your spouse will inherit the first $100,000 of intestate property. Your spouse then inherits three-quarters of the remaining intestate property. Your parents get the remaining quarter of the intestate property.
Children in Connecticut Inheritance Law
If you have children, but no spouse, your children inherit everything. However, if you have a spouse and descendants, such as children, grandchildren, or great-grandchildren, the amount they inherit depends on whether or not they are your spouse’s child. If you die with descendants only from you and your surviving spouse, your surviving spouse will inherit the first $100,000 of intestate property as well as half of the remaining property. Your children will then inherit the other half of the remaining property.
If at least one of your children is not also your spouse’s child, your spouse will inherit half of your intestate property, and your children will inherit the other half of your intestate property.
Intestate Succession: Spouses and Children
|Inheritance Situation||Who Inherits Your Property|
|– Children but no spouse||– Children inherit everything|
|– Spouse but no descendants or parents||– Spouse inherits everything|
|– Spouse and descendants from you and that spouse||– Spouse inherits the first $100,000 of property, and half of the remaining balance|
– Descendants inherit the rest
|– Spouse and at least one descendant from you and someone other than that spouse||– Spouse inherits half of the property|
– Descendants inherit the other half
|– Spouse and parents||– Spouse inherits the first $100,000 of property, and three-quarters of the remaining balance|
– Parents inherit the rest
Your children must legally be your children in order for them to inherit under the laws of intestacy. Legally adopted children have just as much right to their intestate share as do children born outside of marriage. If you were not married to the mother of your children when she had them, they will still receive an intestate share if you married the mother after your children’s birth, a court has determined that you are the father, or you acknowledged under oath in writing that you are the children’s father.
If you placed your biological children for adoption and they were legally adopted by another family, they will not receive an intestate share. However, if your biological children were adopted by your spouse, that won’t affect their right to inherit. Children you conceived that were born after your death are also entitled to an intestate share. A grandchild can only receive their share if that child’s parent is not alive to receive their share.
Unmarried Individuals Without Children in Connecticut Inheritance Law
If you die without a will, spouses, or descendants in Connecticut, your inheritance then goes to the closest living relatives, as explained by the chart below.
Intestate Succession: Extended Family
|Inheritance Situation||Who Inherits Your Property|
|– Parents||– Parents inherit everything|
|– Siblings, but no parents||– Siblings inherit everything|
Although the intestate process is designed to protect your property and make sure it stays in the hands of your family, it is usually best to write your own will. That way, you can ensure that all of your property ends up in the hands you want it in.
Non-Probate Connecticut Inheritances
You might want to know how to avoid the probate process in Connecticut since it can be difficult and expensive. Some of the assets that do not have to go through probate and instead go directly to the beneficiaries are listed below.
Other Situations in Connecticut Inheritance Law
Immigration status won’t affect your inheritance under Connecticut intestate law. If a relative of yours is supposed to get a share of your assets after your death, they can inherit no matter what their citizenship status is. In addition, half-relatives are also entitled to their inheritance as much as “whole” relatives. For example, half-siblings get the same share of the property as “whole” siblings. Posthumous relatives are also entitled to their inheritance. Posthumous relatives are those conceived before, but born after, your death.
There are some protections provided in Connecticut inheritance law as well, such as the slayer statute. Under this law, someone found guilty of killing a relative will not inherit from the decedent.
The Bottom Line
Connecticut doesn’t have an inheritance tax but it is one of several states that has its own estate tax. Plus, every estate needs to take federal taxes into consideration for their estate. It’s important to brush up on the estate and inheritance laws of your state when you’re planning out how to pass your estate on to the next generation. Proper estate planning can account for the taxes and requirements that you must go through in order to properly pass an inheritance on to a spouse, child or other loved one. Without taking the necessary steps, your estate could go through a probate process that will cost time and money.
Resources for Estate Planning
- Setting up your estate with all of the rules and laws you must follow can be hard. That’s why it might be a good idea to work with a financial advisor who specializes in estate planning If you don’t have a financial advisor, finding one doesn’t have to be hard. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
- If you’re wanting to plan out your estate on your own, then be sure you take all of the right things into consideration. Read up on our checklist for estate planning to help you get started.
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