The New York State legislature passed a budget bill on April 1, 2014 which will increase the New York State estate tax exemption over a four year period to $5,250,000 and, by 2019, bring the state estate tax exemption in conformity with the federal estate tax exemption. The increased amounts are as follows:– April 1, 2014 $2,062,500
– April 1, 2015 $3,125,000
– April 1, 2016 $4,187,500
– April 1, 2017 $5,250,000
– January 1, 2019 $5,000,000 (plus the cost of living index from 2010 – thus making the exclusion the same as the Federal exclusion amount).
In addition, the top New York State estate tax rate will be gradually reduced from 16% to 10% over the same four year period and the generation skipping transfer tax enacted in 1999 will be repealed. More significantly, the new law will require that the value of any lifetime taxable gifts made by a New York resident decedent after March 31, 2014 be added back into the New York gross estate. This will increase the amount of estate taxes due. Contact Kiley, Kiley & Kiley to determine if and how the new law will impact your estate plans.