Losing someone you love hurts, and worrying about tax bills only adds to the strain. At King Barnes in Northfield, our inheritance-tax attorneys, Richard M. King Jr. and Jeffrey P. Barnes, guide families from Atlantic City to Cape May through each step of settling an estate. We pair deep knowledge of New Jersey’s inheritance-tax rules with a compassionate touch, so heirs keep more of what their relatives meant them to have.
Ready for clear answers? Call our Northfield inheritance-tax attorneys at (609) 522-7530 today for a free, confidential consultation, and let us protect the legacy your loved one intended for you.
Most heirs never pay income tax on the cash or property they inherit. Inheritances are transfers, not earnings, so they stay off a federal or New Jersey income-tax return. Confusion arises because two “death taxes” exist: an estate tax collected from the estate itself and an inheritance tax sometimes collected from the person who receives the assets.
The federal government imposes only an estate tax, and that applies solely to estates larger than roughly $13 million. For the vast majority of families, the answer is simple: you receive your inheritance free of federal tax, and our South Jersey estate-planning lawyers make sure it stays that way.
New Jersey is one of just six states that still levy an inheritance tax, and the rate turns on how you were related to the person who died.
Example: If a sister leaves her brother $50,000, the first $25,000 is exempt; the remaining $25,000 is taxed at 11 percent. A spouse inheriting the same amount pays nothing. The tax is calculated during probate and must be paid before the county Surrogate releases the full share. Our Northfield inheritance lawyer Jeffrey P. Barnes routinely prepares those filings and keeps families clear of penalties and interest.
Inherited assets themselves are not income. You do not list a bequest on IRS Form 1040 or a New Jersey resident return. Two key exceptions matter:
Estate taxes strike the estate, not the heir. Because the 2025 federal exemption is nearly $14 million per person, only a tiny fraction of estates ever owe the tax. Before you receive a distribution, the executor must settle any estate-tax bill. If your relative’s estate was worth more than the exemption, our federal estate-tax attorneys at King Barnes can prepare Form 706 and work with accountants to claim every available deduction. For everyone else, federal estate tax simply never touches the inheritance you take home.
An inherited retirement account triggers no tax on the day you receive it. The IRS taxes you only when you withdraw funds from a traditional plan. Non-spouse heirs typically must drain the account within ten years, spreading or bunching withdrawals to fit their own brackets. A surviving spouse can roll the balance into a personal IRA and stretch taxes over a lifetime. Roth balances usually exit tax-free. Our New Jersey probate attorneys help craft withdrawal strategies that honor both the rules and your long-term goals.
Rental income, dividends, and interest earned after the property becomes yours count as income, just as if you had bought the asset yourself. Income earned earlier belongs on the estate’s return. King Barnes probate lawyers track which period each dollar falls into so heirs avoid double taxation.
When you inherit real estate or investments, the tax basis “steps up” to market value at the date of death. Sell quickly and your capital gain may be minimal. Hold the asset and any appreciation after inheritance becomes taxable when you sell. A Northfield capital-gains attorney from our team can calculate the stepped-up basis, apply exclusions such as the $250,000 home-sale exclusion, and help you decide the best time to sell.
Life-insurance proceeds paid directly to a beneficiary are almost always tax-free. Cash gifts bequeathed in a will are likewise tax-free unless they exceed New Jersey’s tiny $500 Class D threshold. Federal gift-tax rules rarely bite the recipient; the donor’s estate handles any liability. Our South Jersey estate lawyers keep these distinctions clear so heirs can focus on healing rather than paperwork.
Tax opportunities shrink once a loved one has passed, yet smart choices still exist. A surviving spouse can roll an inherited IRA into a personal IRA to defer income tax indefinitely. Timing the sale of appreciated stocks over two calendar years may soften capital-gains rates. Paying New Jersey inheritance tax promptly eliminates mounting interest that can erode a share.
In rare cases, disclaiming an inheritance within nine months shifts the asset to a tax-favored beneficiary and keeps money in the family. Looking forward, proactive estate planning prevents surprises for the next generation.
Our Northfield estate-planning attorneys craft living trusts, life-insurance trusts, and outright lifetime gifts that route assets to Class A relatives or charities, bypassing state inheritance tax altogether. We design wills that dovetail with beneficiary designations, Powers of Attorney, and health-care directives, giving families clarity and control.
For decades, South Jersey families have trusted King Barnes to navigate probate courtrooms in Atlantic and Cape May Counties and to untangle the New Jersey inheritance tax code. Clients appreciate that our inheritance-tax lawyer Richard M. King Jr. meets with them personally, while estate-administration attorney Jeffrey P. Barnes handles complex filings with calm precision. We return phone calls, explain every form, and fight to preserve the legacy a loved one worked hard to create.
“I’ve worked with Jeff Barnes for many years on a variety of real estate matters, including purchases, sales, condo conversions, and variances. His expertise, professionalism, and attention to detail are unmatched. Jeff always delivers clear advice and outstanding results. Highly recommend him for any real estate legal needs!” – Daniel U.
You do not have to sort through tax regulations alone. Call King Barnes at (609) 522-7530 or visit our Northfield office to schedule a free, confidential consultation with an experienced New Jersey inheritance tax attorney. We will shoulder the paperwork, explain your options, and protect the inheritance your family deserves.
