Question: Will Maryland and/or D.C. follow the increase in the federal estate tax exemption?
Answer: Yes, residents of Maryland and the District of Columbia will have the benefit of higher estate tax exemptions in 2019/2018 respectively.
Federal Exclusion Amounts
The gift and estate tax exclusion will double to $11.2 million starting Jan. 1, 2018.
D.C. Estate Tax
As modified by legislation in 2017, the D.C. estate tax exemption will match the federal basic exclusion amount, as it’s indexed for inflation. This means that the D.C. estate tax exemption will jump from $2 million in 2017 to $11.2 million starting Jan. 1, 2018. Unlike the Federal law, D.C. does not allow for portability. If a D.C. decedent dies, any unused exemption that could shelter assets from D.C. estate tax is lost.
Maryland Estate Tax
Similar to D.C., the Maryland estate tax exemption will match the federal basic exclusion amount starting in 2019, as it’s indexed for inflation. This means that the Maryland estate tax exemption will jump from $4 million in 2018 to approximately $11.2 million starting Jan. 1, 2019. The Maryland estate tax exemption is not portable between spouses until it aligns with the federal exemption in 2019 and thereafter.
As always, if you have any questions or would like to learn more, please contact Steve Shane at firstname.lastname@example.org or .
ABOUT STEVE SHANE
Steve Shane provides strategic counseling to clients in need of estate administration, charitable giving and business continuity planning while minimizing estate, gift, and generation-skipping transfer tax exposure. He offers legal guidance to clients on asset protection and the proper disposition of assets in accordance with the client’s objectives, while employing tax planning techniques such as the use of irrevocable trusts, life insurance planning, lifetime gifts and charitable trust. He is also experienced with drafting documents for business planning, the incorporation and application for exemption for Private Foundations and the administration of decedents’ estates.
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