Updated: November 27, 2023
Overview
The estate tax is a transfer tax on the value of the decedent's estate before distribution to any beneficiary.
For estates of decedents dying in 2006 or after, the applicable exclusion amount is $1,000,000. For estates of decedents dying in 2023 or after, the applicable exclusion amount is $2,000,000. Future changes to the federal estate tax law have no impact on the Massachusetts estate tax.
Definitions
Code: For estate tax purposes, Massachusetts adopts the Internal Revenue Code in effect on December 31, 2000 for the estates of decedents dying on or after January 1, 2003.
Credit for State Death Taxes: A credit, formerly allowed by the federal government, that reduced the amount of federal estate tax paid by an estate. In order to qualify for the credit, the estate must have paid the allowable amount to a state or states. The federal credit for state death taxes was eliminated for the estates of decedents dying on or after January 1, 2005. The federal government now allows a deduction for state death taxes paid for the estates of decedents dying on or after January 1, 2005.
Domicile: A person's permanent and principal home.
Federal Gross Estate: The value of property or interest therein as defined by the Internal Revenue Code in effect on December 31, 2000. The property may be vested or contingent, real or personal, tangible or intangible, jointly held or in the decedent's name alone and, wherever situated, beneficially owned by the decedent at the time of death.
Intangible Property: Property that does not have value in itself, but represents value such as stocks, bank accounts, insurance, and pensions.
Lien: A legal claim by Massachusetts that automatically arises on all property taxable in the Massachusetts estate on the date of death.
Massachusetts Estate Tax: The amount of the federal credit for state death taxes, or the portion thereof, computed using the Internal Revenue Code in effect on December 31, 2000, that is paid to Massachusetts.
Nonprobate Property: Property owned by or in which the decedent had an interest on the date of his or her death and which passes by provisions other than by will or the laws of intestacy such as assets held jointly or by a trust, life insurance not payable to the estate, etc.
Personal Representative: This term includes successor personal representative, special personal representative, persons who perform substantially the same function under the law governing the status, executor, administrator, and special administrator. For appointments after March 31, 2012, the terms executor and administrator were replaced with personal representative. "General personal representative" excludes special personal representative.
Person in Possession: Any person in actual or constructive possession of any property of the decedent, including probate and nonprobate property such as jointly owned assets or life insurance.
Probate Property: All assets that were owned by the decedent in his or her name alone or as tenant in common on the date of his or her death and that pass by will or by the laws of intestacy.
Qualified Terminable Interest Property (QTIP): Property that qualifies for the marital deduction provided:
- The property passes from a decedent to a surviving spouse
- The surviving spouse has a qualified income interest for life in the property and
- The personal representative of the decedent's estate makes an irrevocable election on the Form M-706 to qualify the QTIP property for the marital deduction.
Resident: Any person whose permanent and principal home is in Massachusetts.
Tangible Personal Property: Property that is movable and has a visible existence and a value of its own, such as automobiles, boats, equipment, furniture, jewelry, coin collections, and silver.