How much is the Estate and Inheritance Tax in New Jersey

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Latest post 05-15-2011 1:50 PM by CSLK. 4 replies.
  • 05-15-2011 12:12 PM

    How much is the Estate and Inheritance Tax in New Jersey

    My wife (New York State resident) inherited the estate of her brother (Ocean County, N.J. resident), which includes and house in Ocean County, some cash and money market accounts, and other personal property. Researching on the web I find that New Jersey has both an estate tax and an inheritance tax ranging from 11 per cent to 16 per cent.

    Can anyone explain how that works? How does one determine if the tax is 11 per cent or 16 per cent or somewhere in between?

     

    Is there any legal strategy that can be employed to reduce the tax impact on the estate?

    What is a reasonable fee for a lawyer to handle an estate valued at under $500,000?

     

    Thank you.

     

  • 05-15-2011 12:37 PM In reply to

    • Drew
      Consumer
    • Top 10 Contributor
    • Joined on 03-30-2000
    • PA
    • Posts 48,218

    Re: How much is the Estate and Inheritance Tax in New Jersey

    For a sister and below about $1 million the NJ inheritance tax is roughly 11%  , if a bit over simplified.

    Is the inheritance by will or by deer/title?

    Fees vary and sometimes the costs are in the "extra's" --so be sure toask.

    Will sis take title and use the home or merely sell it...think thru  costs of multiple transfers

    Who is to be executor--executor makes the call as to whom to hire.

    Not a heck of a lot of wiggle room  after the fact  as to estate taxes and values --unless the home is to be used as primary residence for 2 + years  in which case it may be useful to return the home at it lowest defensible valuation.

    Personal property is rarely worth on market what  you think it is worth.



  • 05-15-2011 1:25 PM In reply to

    Re: How much is the Estate and Inheritance Tax in New Jersey

    Thanks for replying.

    There is a will and it has been probated. Letters of Testimentary have been issued. My wife is the executrix of the estate and the sole beneficiary.

    What "extra's" do you refer to? Any ballpark figure on the lawyer fee without extra's?

    Thanks again.

     

  • 05-15-2011 1:28 PM In reply to

    Re: How much is the Estate and Inheritance Tax in New Jersey

    One more thing. Speaking of after the fact, a friend suggested while my brother was still alive that he put my wife's name on the deed. Probably could have been done when they were both in his lawyer's office signing the will. That little mistake will probably cost the estate (my wife) $20 or $30K.

  • 05-15-2011 1:50 PM In reply to

    • CSLK
      Consumer
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    • Joined on 05-15-2011
    • FL
    • Posts 8

    Re: How much is the Estate and Inheritance Tax in New Jersey

    An 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. This form will let you know what the rate is.

    Since your wife is not a New Jersey resident, you may also owe a New Jersey transfer inheritance tax.

    If the estate is worth more than $675 thousand, then you may also owe estate taxes.

    This is the web site where I found this information. http://wills.about.com/b/2009/04/29/estate-taxes-by-state-understanding-new-jersey-inheritance-taxes.htm

    You might also benefit by checking the web site of the New Jersey Division of Taxation at: http://www.state.nj.us/treasury/taxation/index.shtml This site is where wills.about.com got their information from.

    You may need to hire an attorney for this situation. Inheritance and estate taxes can be very confusing.

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