As adults in Nevada begin considering planning for their "golden years" one of the things many consider is where to live. And as some estate planning experts say, location can be everything when it comes to preserving assets and decreasing the tax burdens of loved ones. That being said, there are many things pre-retirees may want to consider. In order to ensure loved ones are not hit with a heavy tax hammer, it's advised to investigate what states offer tax breaks for estate and inheritance taxes.
States can vary greatly on the taxes they impose on beneficiaries. Thus, a conversation with an estate planning attorney can be a wise choice. For example, states like New Jersey and Maryland top the charts on "least favorable places to pass away." Both states levy estate and inheritance taxes. New Jersey's taxes begin at $675,000 for estate taxes, up to 16%. Plus, the state tacks on an additional 16% in inheritance taxes for beneficiaries who are not immediate family.
Fortunately for Nevada residents, our state is one of the most favorable locations to not only die but also to retire. Namely, because Nevada and other states like Florida or Alaska do not have income tax. Additionally, when you die, they not only do not have estate taxes but also inheritance tax. Many experts believe this is a key point to consider and often advise clients who are considering relocation to look into whether or not the state imposes estate taxes.
Fortunately, some states are making changes in their tax laws to retain some of their senior citizens. Estate tax breaks are occurring in some locations in order to discourage residents from moving to states that do not impose taxes triggered by death. Nevada residents should sit tight and enjoy their years of retirement with the comfort of knowing that the estate they have worked so hard to preserve will still be available to their loved ones even after they are gone.
Source: Investment News, "Don't die in New Jersey," Liz Skinner, Nov. 6, 2011