As many of our readers know, the federal estate tax exemption is currently $5.34 million, the highest it has ever been. This provides taxpayers with an excellent opportunity to pass on wealth with little fear of taxation except for the most wealthy. As a result, estate planners—who normally spend a significant amount of time helping folks devise strategies to avoid estate tax—are finding their focus shift to other aspects of the estate planning process. Theoretically, estate tax is still a potential issue at the state level and this should be kept in mind, but many states are taking steps to ease off on estate and inheritance taxes as well.
Maryland is reportedly the latest state to make significant efforts to reduce the estate tax burden on its residents. Measures in both the Maryland House and Senate aim to put the state estate tax exemption on a level comparable to the currently large federal estate tax exemption. Although the measure does not get rid of an inheritance tax assessed on some individuals, it does provide significant relief.