If you live in New Jersey, then you’re lucky enough to live in one of the two states that collects both a separate state inheritance tax and estate tax (the other is Maryland). Currently the following rules apply with regard to the New Jersey inheritance tax:<\/p>\n
\u2022Charitable organizations are exempt from the tax.
\n\u2022All other beneficiaries are broken down into three categories with regard to the tax:
\n\u2022Class A beneficiaries. No tax is imposed on the following beneficiaries – spouses, civil union partners, domestic partners, parents, grandparents, and descendants (including those legally adopted).
\n\u2022Class B beneficiaries. This class no longer exists.
\n\u2022Class C beneficiaries. For the following beneficiaries – siblings, spouse or widow(er) of a child of the decedent, and civil union partner or surviving civil union partner of a child of the decedent – the first $25,000 is exempt and transfers above this amount are taxed at 11%\u201316%.
\n\u2022Class D beneficiaries. For all other beneficiaires, the first $500 is exempt and transfers above this amount are taxed at 15%\u201316%.
\n\u2022Life insurance paid to a named beneficiary is exempt from the tax.
\n\u2022An inheritance tax return, Form IT-R for residents or Form IT-NR for nonresidents, must be filed and the tax paid within eight months after the decedent’s death.
\n\u2022While no inheritance tax return is required to be filed for Class A beneficiaries, Form L-8 may be used to secure the release of bank accounts, stocks, bonds and brokerage accounts. If there was any real property in the name of the decedent, Form L-9, or Form L-9NR for a nonresident decedent, may be filed to release the State’s lien on the real property.<\/p>\n
The bottom line – if you’re a New Jersey resident and your estate is passing to someone other than your immediate family, or if you’re a nonresident who owns real estate and\/or tangible personal property located in New Jersey and it’s not passing to your immediate family, then your beneficiaries may owe a New Jersey transfer inheritance tax. <\/p>\n","protected":false},"excerpt":{"rendered":"
If you live in New Jersey, then you’re lucky enough to live in one of the two states that collects both a separate state inheritance tax and estate tax (the other is Maryland). Currently the following rules apply with regard to the New Jersey inheritance tax: \u2022Charitable organizations are exempt from the tax. \u2022All other […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_daextam_enable_autolinks":"","_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[11],"tags":[37,40,16,30],"class_list":["post-265","post","type-post","status-publish","format-standard","hentry","category-general-estate-planning-and-probate","tag-2009-state-death-tax","tag-estate-tax","tag-nj-estate-tax-2009","tag-top-mistakes-estate-planning"],"_links":{"self":[{"href":"https:\/\/patellawoffices.com\/blog\/wp-json\/wp\/v2\/posts\/265","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/patellawoffices.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/patellawoffices.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/patellawoffices.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/patellawoffices.com\/blog\/wp-json\/wp\/v2\/comments?post=265"}],"version-history":[{"count":0,"href":"https:\/\/patellawoffices.com\/blog\/wp-json\/wp\/v2\/posts\/265\/revisions"}],"wp:attachment":[{"href":"https:\/\/patellawoffices.com\/blog\/wp-json\/wp\/v2\/media?parent=265"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/patellawoffices.com\/blog\/wp-json\/wp\/v2\/categories?post=265"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/patellawoffices.com\/blog\/wp-json\/wp\/v2\/tags?post=265"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}