$7,350,000 in 2026
The threshold is $7,350,000 for deaths in 2026. It was $7,160,000 in 2025 and it is indexed each year.
The short answer
A cliff at 105%
Go more than 5% over — $7,717,500 for 2026 — and New York withdraws the exclusion entirely. The whole estate is taxed from the first dollar.
$7.65M gap to federal
The federal exclusion is $15,000,000 for 2026, so an estate can owe New York a great deal and owe the federal government nothing.
Why the threshold matters
The date-of-death threshold is the one that applies
The New York estate tax threshold is $7,350,000 for deaths in 2026. An estate at or below that figure owes New York nothing. An estate above it owes tax, and an estate more than 5 percent above it loses the exclusion completely.
New York indexes the threshold every year. The figure that applies is the one in force on the date of death, not the one in force when the planning was done.
01The 105% cliff
How the 105 percent estate tax cliff works
New York removes the exclusion entirely once a taxable estate passes 105 percent of the threshold. Most states tax only the amount above their exemption. New York does not.
At or below
$7.35M
A credit cancels the tax in full. Nothing is owed and no return is required.
Phase-out zone
$7.35M–$7.72M
The credit phases out on a sliding scale, so only part of the exclusion survives.
Above the cliff
$7.72M+
No credit at all. The graduated rates apply to the whole estate from the first dollar.
Worked example
$400,000 of extra assets, $739,200 of extra tax
Estate of $7,350,000
$0
New York tax
Passing to the family: $7,350,000
Estate of $7,750,000
($739,200)
New York tax
Passing to the family: $7,010,800
The larger estate leaves the family $339,200 less. The marginal rate on that $400,000 band of value is 185 percent.
02Rates and credit
How New York calculates the tax: the rates and the credit
New York computes tax on the whole taxable estate, then subtracts a credit. The credit equals the tax that would be due on the exclusion amount, which is what cancels the bill for an estate under the threshold. Take the credit away and the whole estate is taxable, which is how the cliff works.
The credit that creates the cliff
| Estate of $7,350,000 | Estate of $7,750,000 | |
|---|---|---|
| Tax computed on the whole estate | $684,800 | $739,200 |
| Credit for the exclusion amount | $684,800 | None, above 105% |
| Payable to New York | $0 | $739,200 |
Nothing about the rates changed between the two columns. Only the credit did.
Rate schedule for the practical bands
| New York taxable estate | Tax |
|---|---|
| $7,100,000 to $8,100,000 | $650,800 + 13.6% of excess |
| $8,100,000 to $9,100,000 | $786,800 + 14.4% of excess |
| $9,100,000 to $10,100,000 | $930,800 + 15.2% of excess |
| Above $10,100,000 | $1,082,800 + 16% of excess |
Fifteen bands exist in total, starting at 3.06 percent on the first $500,000. A New York estate is not taxable below $7,350,000, so the four bands above are the ones that apply in practice. The full schedule is in Tax Law section 952.
03Domicile
Domicile: who New York treats as a resident
New York taxes the estate of anyone domiciled in New York on the date of death. Domicile is a different test from the one used for income tax, and the 183 day rule does not apply here.
Domicile is the place you treat as your permanent home and intend to return to. Buying a property in another state does not change it on its own.
Supports a change
- ✓A permanent home in the new state
- ✓Driver’s license and voter registration moved
- ✓Business and social ties moved across
- ✓A will drafted under the new state’s law
Undermines a change
- ✗Keeping the New York apartment as your main residence
- ✗Spending most of the year in New York
- ✗Family, doctors and advisors still in New York
When it gets tested. The Department can review a claimed change of domicile years after the death, and the estate carries the burden of proving it.
A New York resident’s estate excludes real and tangible property located outside New York under section 954, so a Florida house does not count. A nonresident’s estate includes only real and tangible property located inside New York.
04What counts
What counts in a New York estate
The New York gross estate starts with the federal gross estate, which is broader than most families expect.
Real estate in New York
Including an interest held through a disregarded entity.
Bank and brokerage accounts
A joint account counts in full unless the survivor proves what they put in.
Retirement accounts
IRA and 401(k) balances at full value.
Life insurance
The death benefit counts where the decedent owned the policy. The most common reason an ordinary estate goes over.
Business interests
Closely held shares and partnership interests, at appraised value.
Taxable gifts
Made within three years of death.
Real and tangible property located outside New York comes out of a resident’s estate, so a Florida house does not count.
Deductions then reduce the total. Debts, funeral and administration expenses, anything passing to a surviving US citizen spouse, and anything passing to charity all come off before the tax is computed. The spousal deduction has no cap, which is why many estates owe nothing at the first death and face the full bill at the second.
05Portability & 3-year rule
Portability, the three year gift add-back, and nonresident property
No portability
The unused exclusion is lost
Federally, a surviving spouse inherits the unused exclusion. New York has no equivalent rule, so an exclusion the first estate does not use is lost. For a married couple that is up to $7,350,000 of shelter gone.
3-year add-back
Deathbed giving does not move assets out
Taxable gifts made by a New York resident within three years of death come back into the estate.
Nonresidents
Not exempt
New York taxes real property and tangible property located in New York, in proportion to the New York share of the federal gross estate. Intangible assets, including shares in a cooperative housing corporation, are treated differently, which is worth checking before you assume either way.
NY QTIP
The closest thing to portability
A qualified terminable interest property trust supports a surviving spouse while the assets stay in the first estate for tax purposes. New York allows a separate election on the New York return, and made correctly it lets the first spouse's exclusion be used without giving up the marital deduction.
06NY vs Federal
New York exclusion compared with the federal exclusion
The gap in 2026
Two systems, two filings, and no portability on the New York side.
New York
one person
$7,350,000
Federal
one person
$15,000,000
New York
a couple
$14,700,000
Federal
a couple
$30,000,000
The $7,650,000 per person in between. An estate in this band owes New York a great deal and owes the federal government nothing. A plan built around the federal number alone will miss it.
07Planning
Planning options for an estate near the threshold
Most of what helps has to happen more than three years before death. The usual routes are lifetime giving outside the three year window, using both spouses' exclusions rather than passing everything to the survivor, a New York QTIP election on the return, and for an estate just above the cliff, a charitable bequest sized to bring it back under.
The charitable bequest is worth showing here, because the arithmetic only makes sense against the cliff.
Worked example: a $400,000 charitable bequest against the cliff
| No bequest | With a bequest | |
|---|---|---|
| Estate before deductions | $7,750,000 | $7,750,000 |
| Less: charitable bequest | $0 | ($400,000) |
| New York taxable estate | $7,750,000 | $7,350,000 |
| New York estate tax | ($739,200) | $0 |
| Passing to the family | $7,010,800 | $7,350,000 |
The family receives $339,200 more and the charity receives $400,000. Attorneys draft this as a formula bequest that sends only the amount above the threshold to charity.
9 mo
from date of death to file Form ET-706
+6 mo
extension for filing, but not for payment
2 pros
CPA (the return) + attorney (the wills and trusts)
Estate tax planning in New York City splits between two professions. We do the exposure calculation and the estate tax return. The instruments themselves — wills and trusts — are drafted by an attorney, and we work alongside yours.
08FAQ
Frequently asked questions
What is the New York estate tax threshold for 2026?
$7,350,000. It was $7,160,000 for deaths in 2025, and it is indexed each year against a $5,000,000 base figure set in 2010.
Does New York have an inheritance tax?
No. New York taxes the estate, not the person who inherits. Beneficiaries receive their share with no New York tax of their own.
Can my spouse use my unused New York exclusion?
No. New York has no portability. An exclusion the first estate does not use is lost. A New York QTIP election on the ET-706 is the usual way to recover part of it.
I moved to Florida. Does New York still tax my estate?
It depends on domicile, not on where you spend your time. If New York remains your domicile, your worldwide estate is in scope apart from real and tangible property located outside the state. If the move genuinely changed your domicile, only New York real property and tangible property count.
Which other states charge an estate tax?
Twelve states and the District of Columbia. Owning property in one of them can create a second filing obligation alongside New York's.
What happens if the estate is $1 over the cliff?
The exclusion goes and the graduated rates apply to the whole estate from the first dollar. That is why a valuation near the threshold is worth paying an appraiser for.
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From the record
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Where you sit against the cliff
Find out which side of the cliff you are on
Send us a rough asset list and we will tell you where you sit against the current threshold, and whether the gap is worth planning around. Call (212) 641-0673 or send the contact form.
Reviewed by George Dimov, CPA, New York, NY. Serving clients in all 50 states, 15+ years advising New York families on estate tax planning, exposure and compliance. President of George Dimov, CPA, a New York City firm serving clients across the five boroughs and nationwide.