Just when you thought the estate tax had lost its bite, it turns out more states want to tax your estate.

According to Forbes, the budget troubles and rising deficits hitting nearly every state are making them more aggressive about finding revenue wherever they can – including taxing your estate. Illinois recently became the latest state to impose an estate tax, making it retroactive to the beginning of the year.  All told, 12 states and the District of Columbia now impose a state estate tax of some sort. Eight states enforce an inheritance tax and two states (New Jersey and Maryland) impose both an estate and an inheritance tax.

“It’s a very confusing situation,” says Anita Sarafa, a managing director and wealth advisor with J.P. Morgan Private Bank in Chicago. “You kind of have to prepare for the worst and hope for the best.”

For quick information on your state, Forbes has an interactive map and more information here, and for some number-crunching The Wall Street Journal does some math to figure out the worst places to die in 2011 (little secret there: it is still the double-hit states of New Jersey and Maryland.)

You can learn more about estate planning on our website.

 

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