State Inheritance Taxes
Just because you're likely off the hook with Uncle Sam doesn't mean you are home free. As of 2014, Iowa, Kentucky, Maryland, Nebraska, New Jersey, Pennsylvania and Tennessee impose inheritance taxes. The tax rates vary from state to state, and even within a state, depending on the relationship between the decedent and the heir. For example, if you inherited money from your spouse, you don't owe inheritance taxes in any state.