Estate tax proposal could slam NYC’s wealthy

Rising property values, diminishing tax credit would leave some heirs paying onerous rate

TRD New York /
Apr.April 07, 2014 01:08 PM

Although recent changes to estate law boosted the amount most New Yorkers can leave their heirs tax-free, some wealthy residents could be charged substantially more than their property is worth.

The state legislature initially provided a tax exemption to estates worth less than $1 million.

Governor Andrew Cuomo — aware that property values could easily push homeowners in New York City and elsewhere over the limit — last week proposed gradually increasing the threshold. The exemption is slated to jump to the Federal level of $5.8 million in 2019, Crain’s reported.

But Kevin Matz,  an attorney and certified public accountant based in White Plains, points out the proposal also phases out a tax credit used by the wealthy to reduce the taxable portion of their estate. What’s more, a welter of changes to the tax code in the proposed bill means heirs to estates that exceed the exemption threshold by a mere 5 percent will be forced to pay a steep tax on the overage.

“It creates a problem where if you’re just a little bit above the exemption, you could pay $1.64 in taxes for every dollar you go over,” Matz told Crains. “If it’s not a mistake, it’s somewhat laughable.”

The law comes as tax assessments on properties are set to rise 8 percent in July, the largest jump since June of 2008, as previously reported[Crain’s]Angela Hunt


Related Articles

arrow_forward_ios
Governor Andrew Cuomo and Senator James Skoufis (Credit: Getty Images, NY Senate)

Owners of some residential properties can’t hide behind
LLCs anymore

Owners of some residential properties can’t hide behind
LLCs anymore
Governor Andrew Cuomo and 538 Johnson Avenue in Brooklyn (Credit: Google Maps and Getty Images)

Landlords take another hit: Cuomo signs expanded Loft Law

Landlords take another hit: Cuomo signs expanded Loft Law
Governor Andrew Cuomo (Credit: Getty Images)

Cuomo wants to exempt NYC from prevailing wage bill

Cuomo wants to exempt NYC from prevailing wage bill
Governor Andrew Cuomo and Roosevelt Field Mall in Long Island (Getty)

Malls allowed to reopen in New York state — with strict guidelines

Malls allowed to reopen in New York state — with strict guidelines
Photo illustration of Gov. Andrew Cuomo, Judge C. Stephen Hackeling and Chief Justice Lawerence Marks (Getty, iStock)

Judge rules evictions guidance unconstitutional, moratorium invalid

Judge rules evictions guidance unconstitutional, moratorium invalid
Governor Andrew Cuomo (Getty)

Desperate to open, gyms plan class action against Cuomo

Desperate to open, gyms plan class action against Cuomo
Governor Andrew Cuomo and Mayor Bill de Blasio (Getty, iStock)

New York City indoor dining postponed indefinitely

New York City indoor dining postponed indefinitely
Gov. Andrew Cuomo (Getty)

Cuomo signs bill to extend eviction protections

Cuomo signs bill to extend eviction protections
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...