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New Member
posted Jun 3, 2019 4:44:57 PM

Can I deduct NJ Inheritance tax paid in 2018 on my federal tax?

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3 Replies
Level 1
Jun 3, 2019 4:44:59 PM

Please see edited answer

Alumni
Jun 3, 2019 4:45:00 PM

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State  Inheritance Tax, and Federal or State Estate Tax, are not a part of the Income Tax system.  

TurboTax only supports Income Tax filings.
Inheritance Taxes and Estate Taxes are not allowable deductions, in general, on Income Tax filing

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The ONLY STATES with INHERITANCE TAX on bequests to beneficiaries are:

  • Iowa           - no tax assessed if decedent's estate is under $25,000
  • Kentucky
  • Maryland    -lowest top  tax inheritance tax rate of 10%; small estates of under $30,000 exempt
  • Nebraska   -highest  top tax inheritance tax rate of 18%
  • New Jersey
  • Pennsylvania

All six states exempt spouses, and depending on state, exemption varies for immediate relatives.

Level 1
Jun 3, 2019 4:45:02 PM

Unfortunately, no, these payments are not deductible.

They are an exemption to the deduction for state and local taxes.

For more information, follow this link: https://turbotax.intuit.com/tax-tips/estates/what-are-inheritance-taxes/L93IUc3sC

[Edit 2/2/4/2019 9:45 PST]