Inheritance tax is imposed on the value of the decedent’s estate that exceeds the exemption amount applicable to the decedent’s year of death. The net estate is the fair market value of all assets, less any allowable deductions such as property passing to a surviving spouse, debts, and administrative expenses. The inheritance tax is paid out of the estate by the executor, administrator, or trustee.
Reference: Tenn. Code Ann. §§ 67-8-301-67-8-507.