New Jersey Phasing Out NJ Estate Tax
Finally, after years of arguing, the New Jersey legislature passed a bill, signed by Governor Christie, that would reduce the New Jersey estate tax. Beginning January 1, 2017, only estates in excess of $2 million would be subject to the New Jersey estate tax. Starting January 1, 2018, if it is not repealed, the New Jersey estate tax would be eliminated.
There was a lot of political wrangling in order to get this passed. There is a slight reduction in New Jersey sales tax rate, but not the fact that many items are tax New Jersey that are not taxed elsewhere, and the legislature increased the gasoline tax by $0.30 a gallon. Instead of tightening their belts, the legislature chose to increase taxes in order to eliminate the estate tax. My choice would have been to simply cut the state budget!
Everyone within the state above $675,000 should have their Wills and Trusts, and entire Estate Plan reviewed immediately. Many of the actions we have taken to avoid New Jersey estate tax are no longer necessary. This is particularly true for estates with values between $675,00 and $5.5 million.