Under the new statute, the New Jersey estate tax exemption will be $2 million during the year 2017, and it will be repealed beginning in 2018. The New Jersey inheritance tax, which applies to inheritances received by non-family members, remains in effect.
Source: New Jersey Repeals Estate Tax
Though California has no state death tax, some other states do and the applicable exclusion amounts in those states may be far lower than the federal exclusion amount.
Why should you worry? Well, either your estate or a beneficiary of your estate may be hit if you own property in another state with some form of death tax, even if you live and die here in California. Of course, you may end up retiring in such a state and should consider that, too.
Fortunately, there is a flexible method called Clayton election planning which is useful for many families in minimizing or avoiding both estate tax and tax on capital gains (in addition to many non-tax benefits), and by using multiple QTIP trusts this method can minimize BOTH state and federal death tax.
