What a $100,000 Inheritance Looks Like Depending on the State

Here's something a lot of people don't realize: whether you owe tax on a $100,000 inheritance can depend entirely on where the person who passed away lived — not where you live. Real Time Home Buyers Metro Detroit put together this breakdown to show just how differently a $100,000 inheritance can be treated depending on state law.

The Rule That Matters Most

State inheritance tax is based on where the deceased person lived (or where their real estate was located), not on your own state of residence. So even if you live in Michigan, if you're inheriting from someone who lived in a state with an inheritance tax, that state's rules could still apply to you.

How $100,000 Plays Out in Different States

Michigan. No state inheritance tax and no state estate tax. A $100,000 inheritance from someone who lived in Michigan generally isn't taxed at the state level at all.

Nebraska. Close relatives can be exempt on a good portion of what they inherit, but more distant relatives or unrelated beneficiaries may owe tax once the inheritance crosses certain thresholds — and a $100,000 inheritance can land right at the edge of some of those brackets depending on the relationship.

Maryland. Parents, children, siblings, and grandparents pay a relatively low rate on amounts over $100,000, while more distant relatives face a noticeably higher rate. This is one of the few states where the $100,000 mark is actually a specific breakpoint in the law.

Kentucky, New Jersey, and Pennsylvania. These states generally exempt spouses and often close family members like children or parents, but more distant relatives or non-family beneficiaries can owe a meaningful percentage — sometimes over 10% — on a $100,000 inheritance.

Why This Trips People Up

It's easy to assume that because you live in a state without an inheritance tax, you're automatically in the clear. But if a parent or relative who lived elsewhere leaves you $100,000, it's worth double-checking whether their state has an inheritance tax and how your specific relationship to them is treated under that state's rules — before assuming there's nothing to file.

What to Do If You're Not Sure

If you've inherited $100,000 (or expect to) from someone who lived outside Michigan, it's worth a quick conversation with a tax professional familiar with that state's rules. The relationship to the deceased often matters just as much as the dollar amount.

If part of that inheritance includes a house and you're weighing your options for selling it, Real Time Home Buyers Metro Detroit is happy to help, whether the property is here in Metro Detroit or you're coordinating a sale from out of state. Call us at 248-509-5398 to talk through the details.

This post is for general informational purposes only and isn't tax or legal advice. State inheritance tax rules change and vary widely, so please consult a tax professional familiar with the relevant state.