ADVERTISEMENT

Talk to a Local Inheritance Law Attorney

Enter Your Zip Code to Connect with a Lawyer Serving Your Area

New Jersey State Inheritance Tax

Inheritance Law > Does Your State Collect an Inheritance Tax? > New Jersey

New Jersey State Inheritance Tax

by

In New Jersey, there's an inheritance tax. (The estate tax was repealed in 2018).

The inheritance tax falls on estates worth more than $25,000, but affects only certain heirs, not all.

Close relatives, such as  the surviving spouse, parents, children and grandchilden are entirely exempt, which means that these close relatives will not pay any state inheritance tax, regardless of the size of the inheritance.

Other relatives (such as siblings and the spouses or partners of deceased children) are taxed on inheritances over $25,000. The rate starts at 11% and rises to 16%, depending upon the amount inherited.

Everyone else, except for charities, is taxed at a rate of 15% for the first $700,000 and 16% for amounts over that.

These state-specific inheritance taxes are in addtion to the federal estate tax. There is an exemption of $10 million, which is indexed to inflation and is currently $11,400,000, and only people who die with an estate larger than that exemption will have to pay federal estate tax. It is estimated that only the richest .14% of Americans will be subject to the estate tax at all, or only two out of every 1,000 people who die.

If someone dies in New Jersey with less than the exemption amount (currently $11,400,000), their estate doesn't owe any federal estate tax. The heirs and beneficiaries inherit the property free of federal tax. They don't pay income tax on it, either, because inherited property is not ordinary income. The only exception to this are inherited retirement accounts, which are subject to income tax as the assets are withdrawn.

Information and tax forms can be found at New Jersey's Division of Revenue's website.

 


You may also be interested in:

Every Californian's Guide to Estate Planning

by Liza Hanks
(1st Edition, January 2018)

Every Californian's Guide to Estate Planning

Every Californian's Guide to Estate Planning helps you understand the basics of leaving money and property to loved ones and charities, naming a guardian for children, and planning for beloved pets—with a special focus on issues unique to making an estate plan in California.

In Paperback and eBook (Adobe Reader)  

Buy & download now @
Nolo (publisher)


The Executor's Guide: Settling A Loved One's Estate or Trust

by Mary Randolph, J.D.
(February 2018, 8th Edition)

The Executor's Guide: Settling A Loved One's Estate or Trust

Settle an estate or trust with this all-in-one guide for executors. The Executor's Guide will help you make progress, one step at a time, through the unfamiliar land of legal procedures and terminology.

“Explains how to find state-specific information, and an appendix sorts legalities by state.”-Miami Herald

“Covers the gamut of estate chores and helps you get through them.”-Kiplinger's Retirement Report

In Paperback and eBook (Adobe Reader)  

Buy & download now @
Nolo (publisher)


8 Ways To Avoid Probate

by Mary Randolph, J.D.
(April 2016, 11th Edition)

8 Ways To Avoid Probate

“…complete details for each state…”-Los Angeles Times

The ninth updated edition of 8 Ways to Avoid Probate provides readers with solid advice on easy methods that can skip the probate process, from naming payable-on-death beneficiaries for financial accounts and owning property jointly to creating living trusts and more. It's been completely updated to include the latest estate laws and gift tax rules, and offers a focus on the transfer-on-death deeds which are now available in more states. From personal property such as autos to home ownership and bank accounts, this covers all kinds of transfers and includes case history examples throughout in a recommendation for any general lending library."-Midwest Book Review

In Paperback and eBook (Adobe Reader)  

Buy & download now @
Nolo (publisher)


Quicken WillMaker Plus 2019

by Nolo
(August 2018, 2019 Edition)

Quicken WillMaker Plus 2019

America’s #1 estate planning software
Quicken WillMaker Plus is the easiest way to create your estate plan, whether you're just getting started or you want to update your previous arrangements. This powerful software guides you through the process from beginning to end, giving you the practical and legal information you need to make the best decisions for you and your family.

In Paperback and eBook (Adobe Reader)  

Buy & download now @
Nolo (publisher)


Online Will

by Nolo
(2017)

Online Will

In Paperback and eBook (Adobe Reader)  

Buy & download now @
Nolo (publisher)


ADVERTISEMENT

Talk to a Local Inheritance Law Attorney

Enter Your Zip Code to Connect with a Lawyer Serving Your Area

More New Jersey info from LegalConsumer.com