What is the New York estate tax?

The New York estate tax is a state-level tax on the transfer of property after death. For 2026, estates valued at or below $7.35 million generally owe no New York estate tax. Estates above that threshold may owe tax at graduated rates up to 16%. New York’s estate tax operates separately from the federal estate tax, which has a higher exemption of $15 million per person in 2026.

How does the New York estate tax cliff operate?

The New York estate tax cliff kicks in when your taxable estate exceeds 105% of the basic exclusion amount — $7,717,500 in 2026. Below that threshold, only the excess above the exemption is taxed. Above it, you lose the exclusion entirely and the full estate is taxed from the first dollar. This can mean an estate worth $7.72 million owes significantly more tax than one worth $7.71 million.

How can a credit shelter trust help with New York estate tax planning?

If you’re married and your combined assets approach the New York exclusion amount, a credit shelter trust can help preserve both spouses’ exemptions. Because New York doesn’t allow portability, this trust structure is one way to help ensure neither spouse’s exemption is lost. An estate planning professional can help you determine whether this approach fits your situation.

How can I benefit from an estate plan if I live in New York?

Even if your estate is below the current New York exclusion amount, having an estate plan helps ensure your assets are distributed according to your wishes. An estate plan also positions you to manage future growth that could bring your estate above the threshold. An estate planning professional can help you build a plan that addresses both your current situation and future goals.

Where can I find the current New York estate tax exemption amount?

The New York State Department of Taxation and Finance publishes the current basic exclusion amount on its website. The amount is indexed for inflation and adjusts annually. For 2026, the exclusion is $7.35 million. You can also consult a tax professional for guidance on how the current exemption applies to your specific situation.

How do I calculate my New York estate tax?

Calculating New York estate tax involves determining your taxable estate — which includes your federal gross estate plus certain includable gifts — and comparing it to the basic exclusion amount. New York provides a graduated rate schedule, and online calculators can help you assess your liability. For an accurate calculation, consult a qualified tax professional.

What’s the difference between New York and federal estate tax?

The key differences are the exemption amounts and the cliff. New York’s 2026 exclusion is $7.35 million, while the federal exemption is $15 million per person. New York also has the estate tax cliff, which eliminates the exclusion entirely for estates above 105% of the threshold. Additionally, New York doesn’t allow portability between spouses, while federal law does.

How does New York estate tax compare to other states?

New York is one of about a dozen states that impose a separate estate tax. Its $7.35 million exclusion is higher than some states (like Oregon, which has a $1 million exemption) but lower than the federal amount. Almost no other state eliminates the exclusion entirely when an estate exceeds 105% of the threshold. This makes planning especially important for New York residents.

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How do I check if my state offers a PTET election?

Where can I find help planning around the SALT deduction cap phase-out?

Do I need to adjust my tax planning strategy before 2030?

Should I make a PTET election if my income is near the phase-out threshold?

How does the MAGI phase-out work for the SALT deduction cap?

About Mercer Advisors

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How do I check if my state offers a PTET election?

Where can I find help planning around the SALT deduction cap phase-out?

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