What is the Massachusetts Estate Tax?
The Massachusetts estate tax is a tax on the assets of your estate, if they total $1 million or more. This includes assets that do not pass through probate, like a jointly held home, life insurance proceeds, or retirement accounts.
If your total estate is worth $999,999 at your passing, your estate will owe no estate taxes. If it is worth $1,00,001, your estate will owe approximately $36,000. This is because once triggered, the tax applies to your entire estate, not just the amount over the threshold. The tax due obviously increases the more your taxable assets are worth.
As of July, 2022, there is a bill in the Massachusetts legislature that would increase the individual exemption from $1 million to $2 million, and perhaps more importantly, tax only the assets in excess of the exemption (i.e., over $2 million), unlike the current system where if you trigger the tax it applies to your entire estate.
Learn more here about how to plan for Massachusetts estate taxes.
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