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Inheritance and Estate Tax Rates

Inheritance Tax
Rates depend on the amount received and the relationship between the decedent and the beneficiary or transferee.

INHERITANCE TAX RATES
Beneficiary or Transferee

 Tax Rate for Each Beneficiary or Transferee

Class A

No tax is due

Class C

First $25,000..............................................No tax is due
Next $1,075,000......................................................11%
Next $300,000.........................................................13%
Next $300,000.........................................................14%
Over $1,700,000......................................................16%

 

Class D

First $700,000..........................................................15%*
Over $700,000.........................................................16%

Class E

No tax is due

*No tax is due for transfers to a beneficiary having a total value of less than $500.

Estate Tax
Tax is calculated using either the Simplified Tax Method approved by the Director, Division of Taxation or the Form 706 Method which determines the maximum credit allowed under the provisions of the Internal Revenue Code in effect on December 31, 2001 (see chart below). See Tax Table for the tax rates for dates of death after December 31, 2001, but before January 1, 2017.

ESTATE TAX
Date of Death

Tax Basis

After December 31, 2001,

But before January 1, 2017

The New Jersey Estate Tax is calculated on estates which have a taxable estate* plus adjusted taxable gifts over $675,000However, a New Jersey Estate Tax return must be filed if the resident decedent’s gross estate plus adjusted taxable gifts exceeds $675,000. Tax is based on the credit for state inheritance, estate, succession, or legacy taxes allowable under the provisions of the Internal Revenue Code in effect on December 31, 2001.

On or before December 31, 2001

The tax is the credit for state inheritance, estate, succession, or legacy taxes allowable under the provisions of the Internal Revenue Code in effect on the decedent’s date of death.

*Note: Assets that pass directly to a surviving spouse who is a U.S. citizen are exempt from the taxable estate.

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Last Updated: Friday, 02/10/17



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