Pending Legislative Update

iStock_000015143387LargeA proposal to phase out the New Jersey estate tax passed Senate and Assembly committees on June 23. The proposal would increase the New Jersey estate tax exemption from $675,000 in 2016 to $1 million for 2017 decedents, $2 million for 2018 decedents and $3 million for 2019 decedents. After 2020, the State’s estate tax would be repealed. The State’s inheritance tax would remain in place. The estate tax proposal is part of a tax package that would expand the pension income exclusion, allow an income tax deduction for certain charitable contributions and increase the gas tax. The bill now progresses to the full legislature for action expected before June 30.

UPDATE (as of 6/28/2016):

The proposal to phase out the New Jersey estate tax was pulled from the bill in an Assembly vote at midnight June 27, 2016.  The gas tax increase remains in the bill and another tax relief provision, to expand the pension income exclusion, also remained in the bill. In addition, a provision to reduce the sales tax from 7% to 6% over time was added to provide a more broad based tax reduction.  Negotiations continue as the bill progresses to the full legislature for action expected before June 30