freehold township nj property tax rate 2018

When the New Jersey estate tax was in effect, if an estate was subject to inheritance tax and estate tax, the effect was that the higher of the two taxes was due because the estate received a credit for taxes paid.

Executors are charged with deducting the tax from the bequests before distributing to the beneficiaries. The inheritance tax is assessed against the recipients unless the will directs otherwise.

Even transfers from a very modest estate will incur the tax if the recipients are in a taxable category. There is no exemption from the New Jersey inheritance tax based upon the size of one’s estate. Qualified charities are Class E beneficiaries and gifts to them are exempt from application of the tax. Class D beneficiaries (everyone else) are taxed at 15% on bequests up to $700,000, with a rate of 16% for amounts above $700,000. Class C beneficiaries (siblings, sons- and daughters-in-law, and civil union partners of children) receive a $25,000 exemption and are taxed at rates ranging from 11% to 16%. Class B was eliminated as a category in 1963. Class A beneficiaries (spouses, civil union partners, direct descendants, direct ancestors, and stepchildren) are exempt from the tax. The inheritance tax applies to gifts at death, or within 3 years of death, to beneficiaries who are separated into different classes based upon the relationship of the decedent to the beneficiary. New Jersey’s rates begin at 11% and rise to 16%.

New Jersey is one of six states that have an inheritance tax, the others being Iowa, Kentucky, Maryland, Nebraska and Pennsylvania. However, because the New Jersey inheritance tax remains in place, clients must still consider the effect of the inheritance tax upon their estate plans. Coupled with the significant increase in the federal estate and gift tax exemption ($11.4 million in 2019), the repeal has reduced the need for transfer tax planning by many New Jersey residents. The New Jersey estate tax was repealed effective January 1, 2018.

Freehold township nj property tax rate 2018