2014 Minnesota Estate and Gift Tax Changes

Governor Dayton signed into law changes for Minnesota’s Gift and Estate Tax laws on Friday March 21st, 2014. Below is a link to the bill enacted (HF1777)( Pages 40 to 47 contain the estate and gift tax sections), summary of changes and a table showing it’s tax impact on various sized estates:

http://http://wdoc.house.leg.state.mn.us/leg/LS88/HF1777.4.pdf

1) Annual increases of $200,000 for the MN estate exemption starting in year 2014 and ending in year 2018. In 2018, the exemption will be $2,000,000.

2) The complete and retroactive repeal of the MN Gift tax.

3) The inclusion in the gross estate of federally taxable gifts made within 3 years of death.

4) The minimum estate tax rate is now 10% instead of 9%.

5) Changes in the dollar amounts included in the various rate bands from 10% to 16%.

6) New Minnesota state QTIP election

I created a simple spreadsheet to demonstrate the impact of the exemption changes and amounts between the various tax rate bands between the tax rates to show what the estate tax liability would be by year for a few different sized estates.

Hope this is helpful.

Jeremy P. Green CFP, CTFA, CLU, CEBS, MSFS, AEP, EA 
Wealth Strategist & Expert Witness Consultant
Wealth Strategist Designs
Cell: 612-405-0799