It is going to additionally cut back the state property tax on estates valued at greater than $2 million by nearly $100,000, in line with attorneys Sara Wells, Laura Lerner and Matthew Tudino.
In contrast to the federal property tax exemption, the Massachusetts exemption “isn’t listed for inflation and isn’t transportable between spouses — that’s, for married {couples}, the primary partner to die should use the Massachusetts property tax exemption by passing property price $2 million to people aside from the decedent’s partner or to sure sorts of trusts for the advantage of the decedent’s partner or different people, or that partner’s exemption will probably be misplaced,” the Morgan Lewis attorneys state.
Additional, “the worth of actual property and tangible private property positioned exterior of Massachusetts will probably be includible in a Massachusetts resident’s gross property below the brand new regulation,” in line with the attorneys.
“Nonetheless, the quantity of any property tax because of Massachusetts will probably be decreased in proportion to the worth that the non-Massachusetts situs property bear to the whole gross property,” they wrote.
As an illustration, “if the property tax due on a Massachusetts resident’s gross property (together with non-Massachusetts situs property) is $100,000 and the non-Massachusetts situs property make up 20% of the gross property, the property tax due will probably be decreased by 20% to $80,0000,” the attorneys relayed.
Because the regulation was enacted on Oct. 4, the Massachusetts Division of Income “has not but launched revised property tax types and directions,” the lawyer state. “If an property tax return for a person who died this 12 months has already been filed, a refund request needs to be filed primarily based on the brand new $2 million exemption.”
For property tax returns which might be due within the coming weeks and months, “it might be prudent to file an extension whereas the Division of Income works on issuing revised types,” the Morgan Lewis attorneys stated.