Eight States Usher in Changes to Estate Tax Laws

Although the count of death tax jurisdictions remains the same for 2015 (19 states and the District of Columbia), eight states are marshaling in changes in 2015.  These states are increasing the amount exempt from death tax, indexing the exemption amount for inflation, and eradicating “cliff” provisions that tax the first dollar of an estate.  Moreover, there is action taking place in New Jersey to keep up with the pack, “Gov. Chris Christie can’t run for President with the worst estate tax exemption in the country . . . He has to say he tried.”

New York and Maryland are making the largest changes.  The Maryland legislature acted first by gradually increasing the amount exempt from the state estate from $1 million this year, to $1.5 million in 2015, $2 million in 2016, $3 million in 2017, and $4 million in 2018. Finally, in 2019 it will match the federal exemption that is projected to be $5.9 million.

In New York, exemption amounts were doubled almost immediately.  Like Maryland but using a faster timetable, the New York exemption is set to rise gradually through 2019 to eventually match the federal exemption.  By April 1, 2017, the New York exemption will be $5,250,000. 

As other states continue to make changes, it is assured that there will be more changes on the state death tax map for 2016, if not before. 

See Ashlea Ebeling, Where Not to Die In 2015, Forbes, Sept. 11, 2014.