When Can Self-Executing Tax Waivers (Forms L-8 & L-9) Be Used In NJ?
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Self Executing Waivers are forms which are filed with banking institutions or brokerage firms to release the New Jersey Estate and Inheritance Tax lien which automatically applies when someone dies owning a New Jersey bank account, stock in a New Jersey corporation or a New Jersey bond. They are called “self-executing” because they do not require the State of New Jersey to approve them before the assets are released. However, they cannot be used in all instances. If the taxable estate is more than $675,000, the self-executing forms cannot be used and the Executor must instead file a New Jersey Estate Tax Return in order to get the tax waivers from the State of New Jersey. L-8 forms are used for intangible personal property (e.g. stocks, bonds and bank accounts), while the L-9 form is used for real estate. If a self-executing tax waiver form cannot be used, New Jersey banking institutions will release one-half (1/2) of the date of death value of a bank account until a waiver can be obtained from the State of New Jersey. If real estate is sold by an Estate prior to a proper waiver being obtained, the buyer’s title company will most likely insist upon funds being held in escrow until the waiver is obtained. When the Law Firm of David K. Whitlock is retained to help an Executor administer an estate, proper attention is paid to the waiver law rules so the Estate can gain access to all of its assets as soon as possible. |
