Hot Topics in Health Care: GOOD NEWS FOR NEW YORKERS: ESTATE TAX NEWS

With the passage of the 2014-2015 New York budget, a historic change has occurred for New Yorkers.  If you have served as an Executor of a Last Will and Testament, you know that there was a significant Estate Tax for those NY Estates over 1 million dollars.  Now, at first glance, that may appear like a lot of money, and it sure is, but living in New York, houses can easily be worth 500k, coupled with significant investments, bam you are at 1 million dollars and burdened with a hefty tax burden on your family, after you pass away.

However, with the passage of the new budget, this is all changing. For deaths occurring on or after April 1, 2014, the New York estate tax exemption (the threshold where you have to start paying taxes), will be increased on an annual basis until it equals the federal estate tax exemption, 5.2 million dollars, in 2019.  Please see the chart below:

              DATE                              NY ESTATE TAX EXCLUSION

April 1, 2014 to
April 1, 2015

$ 2,062,500

April 1, 2015 to
April 1, 2016

$ 3,125,000

April 1, 2016 to
April 1, 2017

$ 4,187,500

April 1, 2017 to
January 1, 2019

$ 5,250,000

After January 1, 2019

Same as federal exemption amount
(currently $5,340,000 but increases each year for inflation)

 

However, for those that passed on or before March 31, 2014, the 1 million dollar exclusion was still in effect. The primary reason for the change is that many Senior’s change their residency to other states in order to avoid paying the estate tax.  This will hopefully bring some snow birds back North, (don’t tell them about this past winter) and will add certainty to Estate planning.  Happy Spring!!

 

About Author

  • Email: mlamagna@hhrls.com
  • Michael LaMagna, LNHA, MPA, JD concentrates in the areas of Medicaid and Advanced Asset Protection Planning, Elder Law, Trusts and Estates, Probate and Probate Litigation, Guardianships, Health Care Regulatory Matters, Nursing Home Placement, Long Term Care Insurance, Medicare Appeals, Social Security/SSI Litigation and Special Needs Law. If you have a question for Mr. LaMagna, please call him at (914) 437-5955.