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  • NJ A611
  • Eliminates transfer inheritance tax on Class C beneficiaries and increases filing threshold and applicable exclusion amount for New Jersey estate tax to $1,500,000.
In Committee
Crossed OverPassedSignedDead/Failed/Vetoed
2016-2017 Regular Session
This bill eliminates the transfer inheritance tax on "Class C" beneficiaries and increases the filing threshold and applicable exclusion amount under the New Jersey estate tax to $1,500,000. Specifically, this bill amends the New Jersey transfer inheritance tax to eliminate the tax on transfers made to "Class C" beneficiaries on or after January 1, 2015. Presently, transfers to "Class C" beneficiaries are taxed at a rate of 11 to 16 percent depending on the amount transferred, with the first $25,000 exempt from taxation. "Class C" beneficiaries include brothers and sisters and daughters-in-law or sons-in-law of a decedent. Among the oldest of state taxes, the transfer inheritance tax imposes a tax on beneficiaries for the receipt of assets from a New Jersey resident decedent, as determined by the value of the assets transferred and the beneficiary's relationship to the decedent. By applying separate rate schedules which tax transfers to non-relatives or collateral relatives more heavily than transfers to immediate family members, the tax schedule seeks to alleviate the burden of taxation on those relatives closest to the deceased. This bill would effectively treat transfers to brothers and sisters as well as daughters-in-law and sons-in-law of a decedent on par with exempt transfers to other immediate family members, including the spouse, domestic partner, civil union partner, father, mother, grandparent, or child of a decedent. Additionally, this bill increases the threshold for filing a New Jersey estate tax return from a gross estate of $675,000 to a taxable estate of $1,500,000. The bill also increases the applicable exclusion amount for the New Jersey estate tax calculation from $675,000 to $1,500,000. The bill applies to resident decedents dying after December 31, 2014. Currently, a New Jersey estate tax return must be filed if the decedent's gross estate plus adjusted taxable gifts determined in accordance with the provisions of the federal Internal Revenue Code in effect on December 31, 2001 exceeds $675,000. The New Jersey estate tax is imposed on the estate of a resident decedent equal to the amount of the credit allowed under federal estate tax law for state inheritance taxes paid, based on the terms of the federal estate tax in effect on December 31, 2001, or at the election of the estate, pursuant to a simplified system developed by the Director of the Division of Taxation.
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