Dying in Ohio won’t be quite as costly for small business owners now that the state’s estate tax — also known as the “death tax” — has been put down by Gov. John Kasich. Maine and Oregon are also making changes to their estate taxes.
Gov. Kasich’s move, signed into law July 1, helps the state look more attractive to Ohio’s 200,000 small business owners. Ohio’s small business payroll contributes more than $77 billion dollars to Ohio’s economy, according to the Wall Street Journal.
Although the repeal doesn’t go into effect until Jan. 1, 2013, the elimination of the estate tax will hopefully help end the exodus of Ohio businesses planning to move to more business-friendly climates.
In Maine, the estate tax exemption will double to $2 million Jan. 1, 2013. Oregon has new graduated rates from 10-16% for estates that exceed $1 million. Oregon’s changes to their estate tax goes into effect later this year.
According to Forbes, 22 states, including Ohio and the District of Columbia, still impose an estate or inheritance tax on residents. Ohio currently imposes estate taxes on all personal assets which includes business assets, with the lowest exemption amount per estate at $338,333 but also the lowest top rate at 7%. As recently as January, Illinois enacted a state estate tax with an exemption of $2 million and a top tax rate of 16%.