Idaho has no state inheritance or estate tax. However, the state has its own inheritance laws, including the ones that cover what happens if the decedent dies without a valid will. This article goes over topics that include probate, how to successfully create a valid will in Idaho and what happens to your property if you die without a will. If you want professional guidance for your estate planning or just need help investing an inheritance, it can be a good idea to work with a financial advisor.
Does Idaho have an Inheritance Tax or an Estate Tax?
Idaho does not levy an inheritance tax or an estate tax. Keep in mind that if you inherit property from another state, that state may have an estate tax that applies. You will also likely have to file some taxes on behalf of the deceased. Plus, if your estate is large enough, it may be subject to the federal estate tax.
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 Idaho
To make your will legitimate in Idaho, you must sign your will in front of two witnesses. The witnesses must see you sign the will, or you must tell them that the document is your will. Your witnesses must also sign your will. You do not have to notarize your will in order to make it legal.
However, you can make your will “self-proving,” which helps to speed up the probate process. In order to do that you will need to go to a notary. A “self-proving” will speeds up the probate process because the court can accept the will without contacting the signing witnesses. You can make your will self-proving if you and your witnesses go to a notary and sign an affidavit that states who you are and that each of you knew you were signing the will.
Idaho Probate Process
Once the will is determined to be valid, the next step is the probate process. Idaho is one of the states with the Uniform Probate Code, which means there’s a standard set of rules that applies to Idaho and other states. Probate proceedings are usually only required if the deceased person owned any assets in their name only. Other assets, also known as “non-probate” property, can generally be transferred to the other owner without probate.
Idaho offers a simplified probate procedure and an affidavit procedure that allows heirs to completely skip probate. If the affidavit procedure is used, there is no need to use the simplified probate process. You can use the affidavit procedure when there is no real property that needs to be property, such as a house, home or land, and the value of all personal property left is less than $100,000.
The value of the personal property left behind is calculated after all liens and encumbrances have been subtracted. You can also use the affidavit procedure if all the real property avoids probate through a living trust or right of survivorship, such as joint tenancy, and the value of the personal property is less than $100,000.
To use this procedure the heir must prepare a short affidavit, signed under oath, stating that he or she is entitled to certain property. When the person or institution holding the property gets the affidavit and a copy of the death certificate, it releases the asset to the inheritor. The state’s Department of Health and Welfare can make a claim for medical assistance amounts provided for the decedent against the amount requested in the affidavit. There is a 30-day waiting period when this process is used.
If you do not qualify for the affidavit process, there is still a simplified probate process for small estates. You can qualify for the simplified small estate process if the value of the decedent’s estate after liens and encumbrances are subtracted, does not exceed the value of the exempt property, homestead allowance, family allowance, costs of administration, medical expenses of the last illness, and reasonable funeral expenses. In this case, you do not have to give notice to creditors.
However, you must prepare a closing statement that states the value of the state meets the qualifications to use this procedure and that you distributed and gave a full accounting of the assets to the heirs. You will also need to give a copy of the statement to all inheritors as well as any creditors you. know about that have not been paid.
You can also use this procedure if the surviving spouse inherits everything. They can then file a petition with the court, which will issue a decree to that effect. To use the simplified procedure, the executor files a written request to use it with the local probate court. The court can then allow the executor to distribute the assets without needing to do regular probate.
Dying Without a Will in Idaho
Dying without a will isn’t the best situation if what happens to your assets after your death matters to you. Idaho laws label these types of estates “intestate,” which means there is no will or at least 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, the court will appoint someone, usually an adult child or surviving spouse, to be the executor, commonly known as the personal representative. It is the job of the executor or personal representative to protect the decedent’s property until taxes and debts, if any, has been paid, and then transfer what is left to the heirs.
Although there are often extenuating factors when someone dies intestate, but 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.
Spouses in Idaho Inheritance Law
In Idaho, if you die with a spouse but without a will, the amount your spouse inherits partially depends on how much of the decedent’s property was community property, and how much was separate property. As a general rule, community property is property you got while you were married, and separate property is property you got before you were married. However, gifts and inheritances given to one of the spouses counts as separate property, even if they are given during your marriage.
If you die with a surviving spouse, but no parents or descendants, your spouse inherits everything. If you have a surviving spouse and parents, but no descendants, the surviving spouse will inherit all of your community property and half of your separate property. Your parents will then inherit the rest of the separate property.
Keep in mind that in Idaho, if you and your spouse are legally separated, but not yet divorced, and you die intestate, your spouse will not be entitled to your property. If you have questions or concerns about this area of Idaho inheritance law, you may want to talk to an attorney.
Children in Idaho Inheritance Law
If you have descendants, such as children, grandchildren, or great grandchildren, but no surviving spouse, they will inherit all of your intestate property. If you have descendants and a surviving spouse, the surviving spouse will inherit all of your community property and half of your separate property. Your descendants will then inherit the rest of the separate 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||– Spouse inherits all community property and half of separate property|
– Children/descendants inherit rest of separate property
|– Spouse and parents||– Spouse inherits all community property and half of separate property|
– Parents inherit rest of separate property
Under Idaho law, adopted children have just as much right to their share of intestate inheritance as biological children do. In addition, if the decedent placed their child up for adoption and that child was adopted by another family – other than your spouse – they are not legally eligible to receive an intestate inheritance from the decedent unless the decree of adoption specifically includes the continuation of inheritance rights. However, foster children and stepchildren who were never legally adopted by the decedent are not eligible to receive a share as the decedent’s child.
Children born outside of marriage still receive their share if you participated in a marriage ceremony with their mother that later turned out to be void, your paternity was legally established while you were alive, or your paternity is legally established after your death with clear and convincing proof. The decedent’s children can still receive their share if they are born within ten after the decedent’s death. Grandchildren will receive a share only if their parent is not alive to inherit.
Unmarried Individuals Without Children in Idaho Inheritance Law
In Idaho, if you die without a spouse or descendants, your parents will end up inheriting everything.
Intestate Succession: Extended Family
|Inheritance Situation||Who Inherits Your Property|
|– Parents but no spouse or descendants||– Parents inherit everything|
|– No parents, spouse, ordescendants||– Grandparents, siblings, nieces, nephews then cousins inherit everything|
Idaho has an intestate process designed to make sure your family inherits. However, it is usually best to write your own will to ensure that all of your property ends up in the hands you want it in. If no eligible relatives can be found, the state of Idaho will end up inheriting your property.
Non-Probate Idaho Inheritances
Since the probate process can be expensive and difficult, it’s important to know what your options are when it comes to avoiding probate in Idaho. Listed below are some of the assets that will not have to go through probate and instead go directly to the beneficiaries.
Other Situations in Idaho Inheritance Law
Idaho has a survivorship period. In order to inherit under Idaho’s intestate succession statutes, the heir in question must survive you by at least 120 hours. In addition, relatives conceived before you die but born after you die, known as posthumous relatives, are eligible to inherit as if they had been born while you were alive, as long as they are born within ten months of your death. This includes relatives conceived by artificial insemination.
Immigration status is irrelevant when it comes to inheritance. If a relative of yours is entitled to a share of your assets, they can inherit no matter what their citizenship status is. Half-relatives inherit as much as “whole” relatives. For example, your half-sibling would get the same share as any other sibling.
If you gave gifts or property to a relative during your lifetime, the value of those gifts are only subtracted from the relative’s share if you wrote this down at the time you gave the gift, or the relative admits this in writing. If they are subtracted from the relative’s share, they are known as “advancements.”
The Bottom Line
While there is no estate or inheritance law for the state of Idaho, it doesn’t mean that you’re completely off the hook when passing property between generations. It’s important to make sure you know the process of how to inherit property in Idaho as well as whether you might be liable for any federal taxes related to inheriting the property.
Tips for Estate Planning
- Managing your own estate, or handling the intricacies of inheriting money from the estate of a loved one, can get complicated. That’s why many people choose to work with a financial advisor who can help make sure you do it the right way. Finding the right financial advisor 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 receiving an inheritance then you may be wondering what the best course of action is afterward. Consider reading our guide on what to do with an inheritance for ideas.
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