New Jersey is home to one of the largest populations of elderly residents in the entire country. Many do not have a trust or last will in place. Others may have one, but are unaware if there are tax consequences upon their death. Some question whether he or she would be better served by having either a will or trust in place.
As far as a trust goes, one of the biggest concerns of those contemplating a trust are the tax implications in NJ. Some believe that trusts are not subject to NJ inheritance and/or estate taxes. This is not true. Many trusts, both revocable and irrevocable, are or can be subject to these taxes. Many factors go into determining the taxability of a trust. The entire value of either a trust or a last will can be subject to inheritance taxes depending on who the beneficiary is. Irrevocable trusts have a much better chance of avoiding inheritance tax and perhaps death tax but must be evaluated on a case-by-case basis. If the creator of the irrevocable trust retains certain powers, such as the right to receive income from the trust, the power to change who the beneficiary of the trust it, or the possession or enjoyment of property that is transferred to the trust, the entire value of the irrevocable trust will be subject to New Jersey and Federal estate tax when the creator dies.
Avoiding estate and/or inheritance taxation on your New Jersey Trust can be a complicated matter. A knowledgeable New Jersey trust and estate planning lawyer can help answer all of your questions and assist you in setting up a proper trust or will.
Please contact Fredrick P. Niemann, Esq. toll-free at (855) 376-5291 or email him at email@example.com. Please ask us about our video conferencing or telephone consultations if you are unable to come to our office.
By Fredrick P. Niemann, Esq. of Hanlon Niemann & Wright, a Freehold Township, Monmouth County, NJ Will Contest and Probate Litigation Attorney