There are two forms of so-called “death taxes” in New Jersey: estate tax and inheritance tax. These are also known as transfer inheritance taxes as the assets of the deceased must be transferred to his or her beneficiary. The exact amount and nature of taxes levied against estates is determined by a number of factors including any last wills and testaments, the amount of the assets being transferred, the relationship between the decedent and the beneficiary, and much more. It is also important to understand that residents and non-residents of New Jersey are treated differently in the eyes of the law when it comes to estate and inheritance tax.
To illuminate some of these complex issues, our wills and estates attorneys will be discussing estate tax, inheritance tax, and how these issues may be influenced by your individual and/or family situation.
Inheritance Taxes: Fort Lee Estate Planning Lawyers
Your Fort Lee estate planning lawyers may advise that most individuals and/or estates will owe inheritance tax in New Jersey. As mentioned previously, the exact amount which will be owed and what items are taxable are heavily dependent on your individual circumstances. In NJ, there are two basic situations into which families may fall:
Resident Decedents: if the deceased was a legal resident of our state, he or she will likely be fully taxed through inheritance tax regulations. Taxable assets can include checking accounts, savings accounts, owned real estate, investments, retirement accounts, motor vehicles, owned businesses, and much more.
Non-Resident Decedents: for individuals who were not legal residents of New Jersey, inheritance taxes are more limited in scope. Often times, inheritance tax is limited to properties such as owned real estate and businesses which were located in New Jersey. Since these legal situations can be quite complex, the NJ Treasury has published a Frequently Asked Questions resource for the families of non-resident decedents.
Inheritance Tax in Bergen County, NJ
As of January 1st, 2018, New Jersey has signed a bill which essentially repeals the New Jersey Estate Tax. However, for individuals who passed away before 2018, there estates may still be required to pay estate tax as per the laws at that time. Our Bergen County wills and estate attorneys help clients in all of the following situations:
- Decedents who passed away in 2016 or earlier – estates valued at $675,000 or less were exempt from the NJ estate tax. Estates in excess of this value would be required to pay both inheritance and estate tax
- Decedents who passed away before January 1st, 2018 – the estate tax exemption limit was raised to two $(2) million
- Decedents who passed away in 2018 or later – there is no longer an active estate tax for individuals who died beginning in 2018
How much estate tax each estate owes is pursuant to the Internal Revenue Code. To learn more about the tax laws which may impact your family’s financials, you may consider contacting a Bergen County estate planing attorney.
Issues with the New Jersey Death Tax? Contact our Hackensack Estate Attorneys Today
The estate planning attorneys of Townsend, Tomaio & Newmark have decades of legal experience serving clients from local Bergen County towns including Paramus, Fort Lee, Hackensack, Ridgewood, Teaneck, and all of Northern New Jersey. We understand that after losing a family member, the legal implications of estate law can be overwhelming. Our attorneys are here to handle the legal process so you can your family can focus on the grieving process and moving forward with your lives. New Jersey estate and inheritance tax have changed in the past years, and only working with a qualified and experienced legal team can ensure your best interests will be protected.