Do some states impose estate taxes?
Yes. Even if your estate isn’t big enough to owe federal estate tax, the state may still take a bite. Estate tax. Until recently, most states didn’t impose their own estate tax; instead, they took a share of the federal estate tax paid by large estates. (This is called a “pick-up” or “sop” tax.) But the federal legislation that started the phase-out of the federal estate tax also cut the share of estate tax that states get to keep. To get back some of what they’re losing, some states are collecting tax from estates that aren’t big enough to owe any federal tax. So far, almost half the states have changed their laws so they can keep collecting estate tax. For example, in New Jersey, Rhode Island, and Wisconsin, estates worth more than $675,000 may owe state estate tax.. Property left to a surviving spouse, however, is exempt from state estate tax, just as it is exempt from federal estate tax. Inheritance tax. Some other states impose a separate tax on a deceased person’s property, calle
