The Listen to Lawrence Letter: Federal vs. State Estate Tax Question

CLIENT QUESTION:

Do assets left to the spouse get the same marital deduction that the Fed gives to the NYS cliff tax? In other words, if I leave everything to my wife, there won’t be any NYS estate tax? Is that correct? Although I know the tax would be horrendous on the second death if she is over the “cliff.” Thanks

MY RESPONSE:

YES!

There is never a tax when you leave assets to your spouse. This is true under federal and New York state law. This is called the “unlimited marital deduction.”

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