Planning an Estate in New York involves paying attention to benefits and disadvantages of owning an Estate in the New York as well as the options made possible through the State’s laws. Other factors affecting New York Estate planning include taxes on assets, transactions, and income and the State’s economic and market environment. This article will discuss the following factors that can affect the planning and management of an estate in New York:
1. Relevant State laws governing Estates
2. State estate tax regulations
3. State market and economic conditions
4. Investment and asset ownership opportunities
New York estate laws:
New York estate laws can be read at the following links. These laws are elaborate and detailed so enlisting the assistance of an attorney licensed to practice in the State of New York may be helpful in regard to particular questions. That said, some important aspects of New York estate and trust law can be reviewed for a better understanding of estate conformity to these laws. Additionally, the use of State authorized legal documents, legal and financial services may help in confirming and validating estate related legal documents ex. notary public, estate planner etc.
• New York State law of Wills
• Trusts law of New York State
• Updated New York Uniform and Principal Act
• Legal definition of Estate assets in New York State
Estate and related taxes in New York:
New York State’s taxes are different from several other States meaning the taxation of property and transactions in and through an estate may be subject to differing costs. Summary information regarding New York State taxes is provided below as sourced from bankrate.com and the New York State Department of Taxation and Finance.
Estate tax: Not pegged to Federal minimum taxable estate values; sliding scale up to 16%
State income tax: 4-6.85%
Inheritance tax: None
Property tax: Variable by municipality and/or county
Sales tax: 4-8% including local taxes
State market and economic conditions:
Regional economic differences can make possible interstate variances in the cost of living, availability of capital and financing, market opportunities such as investment diversity and job scope in addition to legal and regulatory differences affecting the management, and oversight of investments and the business environment. Some items of note when planning an estate are as listed:
• GDP: $1.144 trillion: 2008 (11)
• Population: Approximately 20 million
• Taxes as % of GDP: .51% (13)
• Other economic indicators: See Public Policy Institute of New York State, Inc. “Innovation Economy Index” (10)
Investment and asset owning opportunities:
Planning an estate in New York is not vastly different from planning an estate in any other State apart from the differences in State regulations pertaining to estates, their taxation, protection and legality. Since estates are financially important, being aware of State specific options, contingencies and methods in the estate planning process is of relevance. A few New York State specific estate management tips are provided below.
• Qualified Personal Residence Trust (QPRT): Can lower estate value by discounting future value without appreciation. (2)
• Write a valid Will to name an executor and avoid estate division complications. (3) Also, use correct documentation available at the following link (5)
• Estate generation skipping transfer trusts bypass estate taxes after being inherited by Grandchildren, and still provide income for children. If the income received by the children is taxable at a lower rate than the tax on the entirety of the estate, then the tax benefits are advantageous. (6)
• New York State does not tax Government pension annuity distributions (10)
• Personal property in New York State is not taxed, whereas real property is (12)
Ex: Real estate is taxable, cars are not.
New York Estate Planning Resources: