On October 14, 2016, as part of an overall gas tax and income tax compromise, a bill was signed into law that will phase out the New Jersey Estate Tax. Currently, all New Jersey estates in excess of $675,000 are subject to the tax. The threshold for taxation will increase to $2 million for deaths occurring in 2017 and the tax will be repealed for deaths on or after January 1, 2018.
Please keep in mind the current New Jersey Inheritance Tax remains in effect. This tax, ranging from 11% to 16%, applies to all transfers at death to non-spouse, non-lineal descendants, and ascendants. Therefore, a transfer on death to a sibling, aunt, uncle, niece, nephew, cousin, friend, etc. will be subject to the New Jersey Inheritance Tax.
Please reach out to your Citrin Cooperman contact if you have questions or concerns about this change or any other estate planning concerns you may have.