Nebraska Probate Form 500 - Inheritance Tax Worksheet

WHEN AND WHERE TO FILE: This worksheet, together with appropriate pleading, must be filed with the County Court of the Decedent's residence, except as provided in Neb. Rev. Stat. § 77 2014. The tax is due and payable twelve (12) months after the date of death of the Decedent under Neb. Rev. Stat. § 77 2010, except payment may be delayed pursuant to Neb. Rev. Stat. § 77 2009 if there is a delay in coming into possession of the property.

INTEREST: If the Nebraska Inheritance Tax is not paid within twelve (12) months, interest at the rate set by Neb. Rev. Stat. § 45 104.01 shall be charged and collected from twelve (12) months after date of death until the date of payment. Neb. Rev. Stat. § 77 2010.

REFUND OF ERRONEOUSLY PAID TAX: Any Nebraska Inheritance Tax paid in error shall be refunded to the persons who have paid such tax in error. All applications for repayment of the tax must be made to the County Court within two (2) years from the date of payment. Neb. Rev. Stat. § 77 2018.

Specific Instructions

LINES 1 THROUGH 7: Omit these lines if the itemization of the value of the estate is set forth in the Inventory and skip to line 8. Enter the total clear market value as of date of death subject to Nebraska Inheritance Tax. The Federal Estate Tax Return, Form 706, applicable schedules may be used. Include all "flower bonds" redeemable at par. IRC § 6312.

LINE 9: If contribution is claimed on jointly owned property, describe the actual contribution of the survivor.

LINE 12: The homestead allowance of $7,500 has priority over all claims against the estate and is in addition to the succession interest. Neither home ownership nor probate estate is required. This allowance applies to the surviving spouse domiciled in Nebraska, if any, or to minor or dependent children of the Decedent. Nebraska Probate Code § 30 2322.

LINE 13: Exempt property not to exceed $5,000 in value is deductible only to the extent actually taken from the probate or non-probate estate by surviving spouse, if any, otherwise by the adult or minor children of the Decedent. It includes household furniture, automobiles, furnishings, appliances and personal effects, together with such additional other assets of the estate as may be necessary to distribute a total of $5,000. This deduction has priority after homestead allowances, except that the right to any assets to make up a deficiency of exempt property shall abate as necessary to permit prior payment of homestead allowance and family allowance. Nebraska Probate Code § 30 2323.

LINE 14: The family maintenance allowance not to exceed $9,000, except by Court Order, may be paid either in a lump sum or by installments when required to maintain the surviving spouse and minor or dependent children of the Decedent during the administration of the estate. The allowance is payable to the surviving spouse, if living; otherwise, to the children or persons having their care and custody. The allowance is only for one year except by Court Order and is deductible only to the extent actually paid from the probate estate. Nebraska Probate Code § 30 2324.

NOTE: Homestead allowance, exempt property and family maintenance allowance are in addition to all other shares provided a spouse or qualifying children unless a Will provides otherwise or unless disclaimed under Nebraska Probate Code § 30 2352; and calculations should be made accordingly.

LINES 16 THROUGH 25: Include items only to the extent that they were paid from, chargeable to, or paid with respect to property subject to Nebraska Inheritance Tax. Neb. Rev. Stat. § 77 2018.04.

LINE 27: Enter the amount of the Decedent's jointly held property to which the surviving spouse is entitled. Do not include either surviving spouse's actual contribution, spouse's homestead allowance and debts and expenses paid from such joint property, homestead allowance or family maintenance allowance or debts and expenses paid by spouse.

LINE 28: Enter the amount of Decedent's estate to which the surviving spouse is entitled. Do not include exempt property, homestead allowance or family maintenance allowance or debts and expenses paid by spouse. Do not forget the surviving spouse's life estate or remainder interest, Neb. Rev. Stat. § 77 2008, regardless of qualification for a federal estate tax marital deduction. See Nebraska Department of Revenue Regulation 17 001 and 17 005. Use tables in IRS Notice 89 60 for Decedents dying after April 30, 1989.

LINE 29: Enter the amount of Decedent's other property, which is not included on lines 27 or 28 to which the surviving spouse is entitled.

LINES 34 AND 35: Exclude property and indebtedness secured thereto which has been included in the Federal Estate Tax Return, Form 706, but is not subject to Nebraska Inheritance Tax; life insurance paid to a beneficiary other than the estate; and gifts made after January 1, 1977, included in the Federal Estate Tax Return, not in contemplation of death. Attach the schedules showing these exclusions. If alternate valuations were used to determine the total gross estate shown on line 31, the alternate values must be used on these lines. If line 35 is not the same as line 11, explain difference.

LINE 42: List the name of each person who has an interest in property which is subject to Nebraska Inheritance Tax by reason of the death of Decedent, relationship to Decedent, and the person's class.

Enter the Gross Estate distributed to each person. The aggregate distribution must equal line 11, page 1.

The Gross Estate Distribution to each person must be decreased by the following:

  1. Homestead Allowance, Exempt Property and Family Maintenance Allowance. The aggregate must equal line 15, page 1;
  2. The deductions itemized in Lines 16 through 25, page 1. The aggregate must equal line 26, page 1;
  3. An amount equal to the succession interest distributed to the surviving spouse. The aggregate must equal line 30, page 1; and
  4. The Federal Estate Tax paid from the distributee's share of the estate and attributed to the net estate subject to Nebraska Inheritance Tax. The aggregate must equal line 38, page 1.
  5. The net value of each share is the result of the above computations. The aggregate must equal line 41, page 1.

If the Decedent had received property from another person who died within five (5) years prior to the death of the Decedent upon which Nebraska Inheritance Tax was paid, the amount of tax paid shall be a credit against the amount of inheritance tax assessed against the recipients of property from the estate of the Decedent. The credit is to be allocated based upon each recipient's share of the property previously subject to Nebraska Inheritance Tax. Plead name of Decedent, date of death and counties to which Nebraska inheritance tax was paid.

The statutory exemption for each relationship is stated below. The value of the share less the statutory exemption will equal the taxable amount upon which the tax is computed.

Class 1: Father, mother, grandfather, grandmother, brother, sister, son or daughter, adopted children, lineal descendant born in lawful wedlock or legally adopted, or acknowledged children where the relationship has continued for a specified time, or the spouse or surviving spouse of any such persons. There is a $10,000 exemption for each beneficiary. The rate of tax is one percent of the excess over exemption. Neb. Rev. Stat. § 77 2004.

Class 2: Uncle, aunt, niece or nephew related to the deceased by blood or legal adoption, or other lineal descendant by same. There is a $2,000 exemption for each beneficiary. The rate of tax is six percent of excess over exemption up to $60,000, then nine percent of excess over $60,000. Neb. Rev. Stat. § 77 2005.

Class 3: For all others except charitable, there is a $500 exemption for each beneficial interest. The rate of tax is 6 percent of excess over exemption up to $5,000; 9 percent to $10,000; 12 percent to $20,000; 15 percent to $50,000; and 18 percent over $50,000. Neb. Rev. Stat. § 77 2006.

Charitable devises, line 39, page 1, are not subject to inheritance tax. Neb. Rev. Stat. §§ 77 2007.03 & 77 2007.04.

The charitable devise must be reduced by that proportion of the deduction, line 15, page 1, and estate tax, line 38, page 1, paid from the charitable devise's share. Such deduction for the charitable devise must be shown in a column of line 42.

LINE 53: The last column is the total amount of Nebraska Inheritance Tax due. A check or money order must be made payable to the treasurer of each county listed.

LINE 56: This is an agreement by the Personal Representative to adjust the inheritance tax values to follow the adjustment of federal estate tax values. If this is not agreeable, the County Attorney may wish a more formal valuation procedure.

The above instructions are merely suggestions that may warrant review of the law on specific questions; these instructions are of no binding or legal effect.

NSBA Forms 409-1005