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  • NJ A1059
  • Phases out estate tax over five-year period.
In Committee
Crossed OverPassedSignedDead/Failed/Vetoed
2016-2017 Regular Session
This bill phases out New Jersey's estate tax over a five-year period. The estate tax imposes a tax on the estate of a resident decedent based on the amount of the credit allowed under federal estate tax law for state inheritance taxes paid as provided under the Internal Revenue Code as of December 31, 2001. Up until 2002, the State estate tax was designed to absorb the value of federal estate tax credit remaining for state inheritance taxes paid. In 2002, the federal government began phasing that credit out until it no longer existed as of 2005. To avoid the potential revenue loss by the change in federal estate tax treatment, New Jersey tied its estate tax to the amount of such federal credit immediately before the phase out took effect. The resultant State estate tax structure is an imposition which is based upon a federal credit which has not existed for about a decade. This bill phases out New Jersey's estate tax over a five-year period. Beginning with 2011 and continuing up until the tax is no longer collectible in 2015, the amount of estate tax calculated as due under the existing structure will be reduced by 20% each year. In the event the bill takes effect after January 1, 2011, the bill does contain a refund mechanism for the estate of a resident decedent which pays an amount of estate tax due that is subsequently reduced by the enactment of this bill. A request for refund under this mechanism must be made within three years of the date of enactment of this bill. The purpose of this bill is to simplify New Jersey's taxation of decedent estates, while allowing for an orderly adjustment to the associated revenue loss through the bill's five-year phase out.
Introduced, Referred to Assembly Budget Committee  (on 1/27/2016)
Date Chamber Action Description
1/27/2016 A Introduced, Referred to Assembly Budget Committee
Date Motion Yea Nay Other
None specified