New Jersey: A Desirable State for High-Net-Worth Individuals

Mar 20, 2023 | Asset Protection, Estate Planning, Financial

 

New Jersey: A Desirable State for High-Net-Worth Individuals

How New Jersey has become more attractive to high-net-worth individuals

New Jersey has no estate tax.

As of January 1, 2018, New Jersey eliminated its estate tax.

 

New Jersey law protected its wealthier residents by repealing its estate tax.

Originally New Jersey was unwilling to surrender its estate tax revenue even after the federal government eliminated its own state death tax credit. The state took a first step in this direction by increasing the amount of a decedent’s estate which could be exempt from taxation. Soon thereafter, New Jersey completely eliminated its estate tax for any of its residents who died on or after January 1, 2018. The exemption is clearly stated on the New Jersey Department of Treasury website: No New Jersey Estate Tax is imposed on the estates of decedents who die on or after January 1, 2018.

 

New Jersey has no Rule Against Perpetuities, and New Jersey trusts may last forever. 

 

New Jersey permits its residents to use Dynasty Trusts or Generation-Skipping Trusts (GSTs) which may now remain in place in perpetuity. GSTs are the mechanism attorneys use to allow their high-net-worth clients to avoid their children and grandchildren paying taxes on their inherited estates. The result is that the trust assets are available to the high-net-worth decedent’s children without payment of estate tax. If any of the trust assets endure at the time of death of the children, those assets remain in the trust for use by the grandchildren without estate taxation.

During this month, let’s remember those among us, our family, friends, and colleagues, who have to work a lot harder than the rest of us and who don’t get the positive recognition they deserve.

For more information on Estates & Trusts planning, please contact us at 609-409-3500. An attorney at SGW will be happy to assist you.

 



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