The Legislature has passed and the Governor has signed a significant estate tax reform package.
The big news is that the Maine credit shelter exemption will increase from $1,000,000 to $2,000,000 per taxpayer as of January 1, 2013. A married couple will be able to shelter $4,000,000 from Maine estate taxes.
In addition, the estate tax rate structure has been changed as of January 1, 2013, to eliminate the current “cliff tax” on estates which exceed the credit shelter amount. The rate will be 8% on amounts in excess of $2,000,000 and less than $5,000,000, 10% on amounts in excess of $5,000,000 and less than $8,000,000 and 12% on amounts in excess of $8,000,000.
Technical corrections have also been made to the Maine QTIP marital deduction for persons dying after December 31, 2010 so that Maine estate taxes can be deferred until the death of a surviving spouse.
In addition, the time for audit and assessment of estate taxes has been reduced, enabling estates to be closed and distributed sooner.
These are positive developments which should improve the tax climate for Maine residents. I recommend that you check with your attorney to be sure that your Will and Trust are structured to enable you to benefit from these new provisions. If I can help, you can reach me at email@example.com.