Changes to New York State Estate Tax
Written by: Martin X. Shields
Beginning April 1, 2014 New York state estate tax was changed from having an exclusion amount of $1 million per person to $2,062,500 per person. This exclusion amount will continue to increase as shown in the table below until it is aligned with the federal exemption amount.
| Time Period | NYS Estate Tax Exemption Amount |
| Prior to April 1, 2014 | $1,000,000 |
| 4/1/14 – 4/31/15 | $2,062,500 |
| 4/1/15 – 3/31/16 | $3,125,000 |
| 4/1/16 – 3/31/17 | $4,187,500 |
| 4/1/17 – 12/31/19 | $5,250,000 |
| 1/1/19 and Thereafter | Federal Exemption Amount |
Any personal property outside of New York state is excluded from this amount and the inheritance tax ranges from 3.06% to 16% for estates over $10,000,000.
The new law also adds a limited 3-year look back period for gifts made between April 1, 2014 and Jan. 1, 2019. Specifically, if a NY resident dies within three years of making a taxable gift, the value of the gift will be included in the decedent’s estate for purposes of computing the NY estate tax.
The New York generation-skipping transfer tax has also been repealed, meaning that New York will not impose a generation-skipping transfer tax on outright gifts to persons who are two or more generations below the transferor.
The one caveat to remember with New York State inheritance tax is if you are more than 5% over in personal exemption amount, the full amount of the estate is taxed and there is no exclusion amount. For example, in 2017, when the exempt amount will be $5.25 million, the estate of someone who dies with an estate equal to the exempt amount would pay no tax. But someone who leaves an amount that’s five percent over the exempt amount ($5,512,500) would owe New York estate tax of $430,050. In other words, there’s a $430,050 tax on the extra $262,500.
IMPORTANT DISCLOSURE INFORMATION
Please remember that past performance is no guarantee of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Bouchey Financial Group, Ltd. [“Bouchey Financial”]), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, no portion of this discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from Bouchey Financial. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. Neither Bouchey Financial’s investment adviser registration status, nor any amount of prior experience or success, should be construed that a certain level of results or satisfaction will be achieved if Bouchey Financial is engaged, or continues to be engaged, to provide investment advisory services. Bouchey Financial is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of the Bouchey Financial’s current written disclosure Brochure and Form CRS discussing our advisory services and fees is available for review upon request or at www.bouchey.com. Please Note: Bouchey Financial does not make any representations or warranties as to the accuracy, timeliness, suitability, completeness, or relevance of any information prepared by any unaffiliated third party, whether linked to Bouchey Financial’s web site or blog or incorporated herein, and takes no responsibility for any such content. All such information is provided solely for convenience purposes only and all users thereof should be guided accordingly. Please Remember: If you are a Bouchey Financial client, please contact Bouchey Financial, in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing/evaluating/revising our previous recommendations and/or services, or if you would like to impose, add, or to modify any reasonable restrictions to our investment advisory services. Unless, and until, you notify us, in writing, to the contrary, we shall continue to provide services as we do currently. Please Also Remember to advise us if you have not been receiving account statements (at least quarterly) from the account custodian.