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Inheritance tax is a tax on the transfer of assets from a dead person to their heirs. It is levied on the value of the assets, not the amount of money that is actually received by the heirs.

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In the United States, there is no federal inheritance tax. However, six states have an inheritance tax: Iowa, Kentucky, Maryland, Nebraska, New Jersey, and Pennsylvania. The exemption thresholds and tax rates vary from state to state.

For example, in Iowa, the exemption threshold for lineal descendants (children, grandchildren, etc.) is $1 million. This means that if a person inherits assets worth more than $1 million from their parent, they will owe inheritance tax on the amount that exceeds $1 million. The tax rate is 0.8% for the first $500,000 and 1.6% for the amount above $500,000

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