Updated: 2020-09-14 by
Here's a quick summary of the new gift, estate, and inheritance changes that came along in 2019. Spoiler alert: very few people now have to pay these taxes.
1. The federal estate and gift tax exemption has been increased from $5,000,000 in 2017 to $10,000,000 in 2018, indexed to inflation. In 2019, that is $11,400,000. This higher federal exemption means that fewer people will be subject to the estate tax, since only estates with assets that exceed that exemption are required to file a federal estate tax return. (Surviving spouses of decedents with estates less than this exemption may still decide to file an estate tax return to request portability, which is the ability to use their deceased spouse's unused exemption at their own death, but they are not required to do so.) Click here to find out more about when an estate tax return does, or doesn't, need to be filed.
2. Several states have increased their state estate tax exemptions, either because they were already indexed for inflation or because they changed their state laws, either way this means that fewer residents of those states will be subject to estate tax.
- New Jersey and Delaware have eliminated the estate tax altogether.
- Connecticut, Maine and Hawaii match the federal exemption and allow the surviving spouse to make sure the deceased spouse's unused exemption, just like the feds do.
- Washington D.C. and Maryland have set their exemption levels to $5 million. Washington D.C.'s exemption is indexed to inflation, Maryland's is not.
- Rhode Island's exemption will be indexed for inflation ($1,537,656 million for 2018).
- Washington state's exemption will be indexed for inflation ($2.193 million for 2018).
- New York is increasing it's estate tax exemption to $5.25 million.
- Minnesota increased it's exemption to $2.4 million.
- Massachusetts and Oregon have an exemption of $1 million per person.
You may also be interested in:
When beneficiaries inherit assets, those assets generally receive what's called a "step up"in basis. Understand how this saves beneficiaries taxes on appreciated assets.
Each state has rules, called the laws of intestacy, that determine how to divide property when a spouse dies without a Will. Read this article to find out who inherits if a spouse or parent dies without a Will in New York.
Here is an overview of how this site works and what articles you'll find most useful. It can be confusing to sort out the process, the taxes, and the issues that arise after someone's death. This site will help.