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Changes to Estate and Tax Laws in the Garden State


Changes to Estate and Tax Laws in the Garden State

Now that New Jersey’s new tax and estate laws are in effect, many people are wondering if they need to make changes to their estate plan, and more specifically, if they need to continue to keep trusts in place. For most people, trusts are usually part of a larger strategy. Don’t do anything without discussing the trust with your estate planning attorney.’s article, “Biz Brain: Changes to N.J.'s estate tax and you,” says that part of the question to consider is whether the trust has been funded. If it’s been funded, then before you terminate a trust that was created as part of your overall estate plan, you must look into the tax consequences of the income and transfer tax of a termination.

Even if there is no immediate tax consequence, there could be other reasons to maintain the trust even though the state will repeal its estate tax effective in 2018.

It's possible that by 2018 or after, the state legislature could reinstate the estate tax.

Another possibility is that you could move to a state that has an estate tax. In that case, you'd need to recreate the trust. In the end, keeping the trust intact doesn’t hurt anything.

A trust may also be established for reasons unrelated to taxes.

Some trusts are designed for management and creditor protection of assets. If a beneficiary is disabled or is receiving certain government assistance, a trust may have been created as a special needs trust. Terminating that trust and the payment of monies outright to the beneficiary could cause a beneficiary to lose governmental benefits.

Although New Jersey will eliminate its estate tax effective January 1, 2018, there’s still a federal estate and gift tax subject to an exemption of $5.49 million effective January 1, 2017.

Your trust may have been created for a variety of reasons, some of which having little or nothing to do with reducing your estate tax. Best bet: speak with an experienced trust and estate attorney who is familiar with the laws in your state before making any changes. You don’t want to undo something that still works, and you don’t want to create unnecessary problems.

Do you live in Miami-Dade, Broward, or Palm Beach counties in Florida? Laws are constantly changing-- has your estate plan been reviewed in the last 2-3 years? Call me (954-888-1747) right away for peace of mind. I can help!

  • My practice is exclusively estate planning and probate,
  • I have prepared numerous estate plans in 16 years of practice,
  • I have administered estates and trusts through Probate all over Florida,
  • I am a Certified Financial Planner Professional™, and
  • I am here for YOU today and there for your FAMILY tomorrow.

Reference: (January 3, 2017) “Biz Brain: Changes to N.J.'s estate tax and you”

Why would we recommend D.T.F.? Several Reasons: Your ability to explain complex estate problems, clearly and patiently; your total lack of arrogance and pretense; a strong feeling that you are motivated by what you perceive is best for your client, rather than what would generate the largest legal fees; finally, and importantly, you are a lovely guy. A.C.

Two words cannot sum up the entire process of creating my “trust.” I enjoyed your attention to detail, your patience of explaining terms and conditions until I understood, also giving me copies to read and understand. Thank you for your suggestions on what was best for “me” but still allowing me to make my choice. Most of all, thank you for thinking of “me.” Wells Fargo said “you were the best” I cannot deny that. Again thank you very much for everything. Anna is an asset or a compliment to the firm. She is warm and very caring. It was great doing business. Thank you.