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New York rich face tax surprise when they die: Tax rate of 164 percent on portions of their estates
CNBC ^ | 04/08/2014 | Robert Frank

Posted on 04/08/2014 2:20:29 PM PDT by SeekAndFind

If you're a New York multimillionaire, you now have another incentive to stay alive.

A change this month in New York's estate tax, which was billed as tax relief for the wealthy, contains a hidden wrinkle that could leave some multimillionaires with a much bigger surprise tax upon their death. Certain estates could even wind up with a tax rate of 164 percent on portions of their estates, according to one tax expert.

The changes were intended to ease the tax bill for wealthy New Yorkers and prevent them from fleeing to lower-tax states. A report from the Tax Foundation found that New York had the highest tax burden in the country as a percentage of state income. It found that New Yorkers spent 12.6 percent of their per capita income in 2011 on state and local taxes.

nstead of lowering the tax bill, the estate tax change could raise it.

"It's nonsensical," said Kevin Matz, an accountant and attorney in White Plains, N.Y. "The governor said this is about making New York a better climate for the wealthy. It's had the opposite effect."

On its face, the new law seems like tax relief. Under the previous law, New Yorkers paid estate taxes of 3.06 percent to 16 percent on the value of estates over $1 million. The new law raises that exclusion to $2.062 million this year and gradually increases it to more than $5 million by 2017.

But because the law also phases out certain credits related to federal taxes, people who have estates valued just above the $2 million threshold could get massive estate tax bills.

(Excerpt) Read more at cnbc.com ...


TOPICS: Culture/Society; Government; News/Current Events; US: New York
KEYWORDS: andrewcuomo; billdeblasio; chirlanemccray; deathtax; estatetax; newyork; newyorkcity; taxes
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1 posted on 04/08/2014 2:20:29 PM PDT by SeekAndFind
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To: SeekAndFind

RE: people who have estates valued just above the $2 million threshold could get massive estate tax bills.

If you own property in Manhattan or certain parts of Brooklyn (which you bought decades ago), at the rate the property values are rising, $2 Million is a threshold you can easily reach.


2 posted on 04/08/2014 2:22:21 PM PDT by SeekAndFind (If at first you don't succeed, put it out for beta test.)
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To: SeekAndFind
The changes were intended to ease the tax bill for wealthy New Yorkers and prevent them from fleeing to lower-tax states.

IT WON'T 'PREVENT' ANYTHING........It just gives them a new reason...................

3 posted on 04/08/2014 2:24:05 PM PDT by Red Badger (LIberal is an oxymoron......................)
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To: SeekAndFind

New York State is on it’s own, freaking Commies... serves them right for chasing away the conservatives, that is ? if there are any left there.


4 posted on 04/08/2014 2:26:43 PM PDT by American Constitutionalist
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To: AdmSmith; AnonymousConservative; Berosus; bigheadfred; Bockscar; cardinal4; ColdOne; ...

Cuomo sez, you don’t think like me, get out.


5 posted on 04/08/2014 2:28:46 PM PDT by SunkenCiv (https://secure.freerepublic.com/donate/)
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To: SeekAndFind

How can you pay more than 100%?


6 posted on 04/08/2014 2:29:56 PM PDT by smokingfrog ( sleep with one eye open (<o> ---)
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To: SeekAndFind

THE BEATLES
“Taxman”

(1,2,3,4

Hrmm!

1,2...

1,2,3,4.)

Let me tell you how it will be
There’s one for you, nineteen for me
Cos I’m the taxman, yeah, I’m the taxman

Should five per cent appear too small
Be thankful I don’t take it all
Cos I’m the taxman, yeah I’m the taxman

If you drive a car, I’ll tax the street
If you try to sit, I’ll tax your seat
If you get too cold I’ll tax the heat
If you take a walk, I’ll tax your feet

Taxman!
Cos I’m the taxman, yeah I’m the taxman

Don’t ask me what I want it for (Aahh Mr. Wilson)
If you don’t want to pay some more (Aahh Mr. Heath)
Cos I’m the taxman, yeah, I’m the taxman

Now my advice for those who die
Declare the pennies on your eyes
Cos I’m the taxman, yeah, I’m the taxman

And you’re working for no one but me
Taxman!


7 posted on 04/08/2014 2:34:56 PM PDT by Red Badger (LIberal is an oxymoron......................)
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To: SeekAndFind

8 posted on 04/08/2014 2:36:11 PM PDT by Vaquero (Don't pick a fight with an old guy. If he is too old to fight, he'll just kill you.)
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To: SeekAndFind

“Rich” New Yorkers should realize that today’s tax relief will be tomorrow’s tax loophole. And it will be closed after you’ve been vilified for receiving such a benefit from the state.


9 posted on 04/08/2014 2:51:31 PM PDT by paint_your_wagon
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To: SeekAndFind

A movement must be started to reform the power of the national government and the states to “tax and spend.” The politicians cannot stop and will lead us into financial ruin all the while believing they can explain away the resulting chaos.


10 posted on 04/08/2014 2:56:00 PM PDT by AEMILIUS PAULUS (It is a shame that when these people give a riot)
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To: smokingfrog
How can you pay more than 100%?

Involuntary servitude for your heirs.

11 posted on 04/08/2014 2:56:56 PM PDT by Navy Patriot (Join the Democrats, it's not Fascism when WE do it, and the Constitution and law mean what WE say.)
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To: smokingfrog
How can you pay more than 100%?

They rip the gold fillings out of your teeth, then go after your heirs' gold fillings too.

12 posted on 04/08/2014 2:58:02 PM PDT by Cementjungle
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To: smokingfrog
How can you pay more than 100%?

If that portion of your estate is valued at $100K, then your tax bill would be for $164k.

Hey, it is only your fair share, right?

13 posted on 04/08/2014 3:00:01 PM PDT by BwanaNdege
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To: BwanaNdege

Why anyone would live in ny is beyond me!


14 posted on 04/08/2014 3:05:12 PM PDT by bicyclerepair (The zombies here elected alcee hastings. TERM LIMITS ... TERM LIMITS)
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To: Cementjungle
They invade the capital upon which income is based. For example, if one has $100 in the bank earning 3% per year they would take the 3% and invade the $100.
15 posted on 04/08/2014 3:05:14 PM PDT by AEMILIUS PAULUS (It is a shame that when these people give a riot)
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To: smokingfrog
How can you pay more than 100%?

Explanation

16 posted on 04/08/2014 3:11:58 PM PDT by SC DOC
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To: smokingfrog
How can you pay more than 100%?

Explanation

17 posted on 04/08/2014 3:11:58 PM PDT by SC DOC
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To: SeekAndFind

If you think one of these folks is going to pay a dollar in taxes then I have a huge lake in the desert to sell you. No way do multi-millionaire pay taxes when they die. They have irrevocable trusts. Sorry New York. Try harder next time.


18 posted on 04/08/2014 3:16:04 PM PDT by napscoordinator ( Santorum-Bachmann 2016 for the future of the country!)
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To: SeekAndFind

This state is on it’s deathbed.


19 posted on 04/08/2014 3:52:07 PM PDT by The Mayor (Honesty means never having to look over your shoulder.)
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To: SeekAndFind

I thought no NY millionaire EVER died there.
I thought they all died in Florida?


20 posted on 04/08/2014 3:53:30 PM PDT by nascarnation (Toxic Baraq Syndrome: hopefully infecting a Dem candidate near you)
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