Feb 1, 2018 | Written by: Share|
As of January 1, 2018, there is no longer any New Jersey estate tax, as per New Jersey P.L. 2016, c. 57. Many New Jersey residents have been asking, “Do I still need a will, since there is no need to consider tax-planning?”
The answer is yes, there are many reasons that you still should have a valid will in New Jersey. Here are five such reasons:
1. While the New Jersey estate tax has been repealed, there are still the Federal estate tax and the New Jersey inheritance tax to consider. Some New Jersey residents may have assets that exceed the current federal limits, and they will still want to include possible tax-planning provisions in their wills. The New Jersey inheritance tax is a separate tax that focuses primarily on the relationship between the testator and the beneficiary. In considering an estate plan, the possible imposition of the New Jersey Inheritance tax should be considered.
2. For parents of minor children, the news that their children could inherit at the age of 18 may come as a shock. If both parents should pre-decease the minor child, and there is no will, the minor child will receive their entire inheritance upon reaching the age of 18. While some parents may feel that their children can handle significant financial decisions at 18, others would prefer that their children reach a more advanced age before receiving the complete inheritance. With a will, this can be covered by provisions that until such advanced age is reached, the inheritance will be held in trust for the beneficiary, but still be available for that beneficiary’s education, support, health, and maintenance.
3. Without a valid will that nominates a specific individual or entity as the executor of the decedent’s estate, the Surrogate’s Court will choose that person. The Surrogate may require that such person pay for and post an administrator’s bond, which can be time-consuming and expensive to obtain. But if the decedent has a valid will, the Surrogate will be guided by the decedent’s nomination, and will waive the requirement of a bond if certain language has been included in the will.
4. The New Jersey legislature allows for a personal property memorandum if a decedent’s will specifically permits it. A personal property memorandum enables a person to make a list that says to whom their personal property (such as jewelry, antiques, art, sports equipment, memorabilia, etc.) will be distributed to on their death, and allows the person to amend that list from time to time without visiting an attorney.
5. At a time when a family is dealing with all the emotions that a loved one’s death will cause, having a valid will is one less worry for them. Having a valid will allows the estate administration to proceed without question or difficulty. It is a gift to the family, and it allows them to move forward with certainty that they are following their loved one’s instructions.
NOTE: The foregoing may largely depend on specific circumstances surrounding individual cases, which may or may not be consistent with your circumstances or may no longer be up-to-date to the extent that laws have changed since posting. If you are seeking specific legal advice, you should contact a lawyer to review your specific issues.