How to Beat Your State's Estate Tax

The New York Times recently reported the effect of state estate taxes on the superrich. I hope Gov. Murphy wasn’t reading that article. According to the Times, if Jeff Bezos of Amazon were to die a resident of the State of Washington which apparently has an estate tax the State of Washington would be enriched by about $12 billion. That is pretty impressive considering that Washington State’s entire budget for two years is a meager 52 billion dollars. You can almost imagine state tax assessors counting down the days for the rich and famous to kick the bucket. Now in fairness to the wealthy a simple planning technique can deny states like Washington billions of dollars. With all that loot the wealthy can simply… move. That is not to say that living in Seattle would be the same as living in Naples, Florida especially for one not used to seeing the sun on a regular basis. But the wealthy are not alone in making this transition. For us in New Jersey it’s the income tax that drives out many people to places like Florida. If your income is fat enough the New Jersey income tax, if avoided, could be large enough to pay your real estate taxes and green fees on that Naples golf course condo. All that’s required is a set of Florida license plates and being able to count to 181. Perhaps some sophisticated auditing technique used by the state can determine whether or not you are in fact a resident of Florida when you return to New Jersey for “vacation” when eggs are being cooked on Florida sidewalks. But with facial recognition be careful. When your face starts showing up at the local Costco when you are supposed to be in Florida, your tax planning may go up in smoke. BTW the Prez himself has declared he is now a Florida resident. You see it really works...just move!