Estate Tax Lawyer Boston
You’ve worked your whole life to build a legacy. You want to do everything you can to ensure that your legacy is passed down to your loved ones after your death.
However, if your estate is large enough to incur Massachusetts estate taxes, your loved ones may inherit less than you might expect. That’s where careful planning can make a big difference.
The experienced estate tax lawyers at Jillise McDonough Estate Planning Law Firm may be able to help you reduce the value of your taxable estate, lowering your estate taxes or even eliminating them. If you’re looking for the best estate tax lawyer Boston has to offer, we’re here for you.
Massachusetts Estate Tax Overview for Boston Residents
Do you need a death tax lawyer? The answer to that question largely depends on the size of your estate.
The federal estate tax law sets the lifetime gift and estate tax exemption at $15 million as of 2026 ($30 million for married couples). However, the Massachusetts estate tax applies to many smaller estates because the state-level exemption is much lower.
Understanding the Massachusetts Estate Tax Laws
In Massachusetts, the estate tax exemption is $2 million. If your estate is worth more than $2 million, it will be subject to state estate taxes.
However, only the portion of the estate above $2 million will be taxed. Depending on the value of the taxable estate, rates range from 0.8% to 16%. A state estate tax attorney can help you understand which tax rate may apply to your estate.
Here are some other important estate tax considerations to be aware of:
Non-Portability
The federal estate tax exemption is portable, which means a surviving spouse may use the remainder of a deceased spouse’s exemption. This isn’t the case with Massachusetts estate taxes.
Handling Out-of-State Property
If you’re a Massachusetts resident and you have property outside the state, that property won’t count as part of your estate for tax purposes.
Taxes for Out-of-State Residents
If you aren’t a Massachusetts resident but you have property in Massachusetts, your personal representative may need to file a Massachusetts estate tax return. Here’s how these taxes are determined:
- The total value of your worldwide estate is calculated
- If your gross estate is worth more than $2 million, estate taxes will be owed
- The amount owed to Massachusetts is proportional to the value of your property within the state
If you think your estate may be subject to Massachusetts estate tax but aren’t sure, don’t hesitate to reach out. Our knowledgeable trust and estate tax lawyers can help you navigate Massachusetts law and make a plan to keep your estate taxes to a minimum.
Key Changes to Massachusetts Estate Tax Law
Massachusetts’s estate tax might seem high, but just a few short years ago, the estate tax exemption was much smaller than it is today. A greater number of estates were subject to the estate tax, and those estates usually owed much more than they would today.
In October 2023, Massachusetts passed a law establishing an estate tax credit of up to $99,600. This change eliminated estate taxes on estates valued at less than $2 million. Previously, estates had to be valued at $1 million or less to escape Massachusetts estate taxes.
The new tax laws also substantially reduced taxes on estates valued at $2 million or more. Previously, if your estate surpassed the $2 million threshold, the whole estate would be subjected to estate tax. With this change, only the amount of the estate exceeding $2 million is now taxable.
In September 2024, the state introduced another change to lower the tax liability of anyone holding property outside of Massachusetts.
Before the September 2024 change, the value of an individual’s worldwide estate was totaled, and the total value determined whether they owed Massachusetts estate tax. The amendment to the law now means that only property located in Massachusetts counts toward the estate for tax purposes.
Estate Tax Exemption and Calculating the Gross Estate
Not sure whether your estate will exceed the Massachusetts estate tax exemption? Take a look at the value of your gross estate. This is the total fair market value of all property you have at the time of your death.
Here are some of the common components of gross estates:
- Real estate (including your primary home, vacation homes, investment properties, etc.)
- Bank accounts and certificates of deposit (CDs)
- Brokerage accounts, money market accounts, and other financial accounts
- Proceeds from your life insurance policy
- 401(k)s, 403(b)s, IRAs, and other retirement accounts
- Cars, jewelry, artwork, and other personal property
- Digital assets
- Business interests
Determining the value of your gross estate can be challenging. Our estate planning lawyers can help you understand the total worth of your Massachusetts taxable estate.
Once you know the gross value of your estate, you’ll subtract the $2 million exemption. Any remaining amount may be taxed.
Keep in mind that Massachusetts uses a graduated estate tax system. Rates can be anywhere from 0.8% to 16%, increasing along with the value of your estate.
Massachusetts vs. Federal Estate Tax and Filing Requirements
It’s important to understand the estate tax landscape as you put together your estate plan. If you think your estate may incur both state and federal estate taxes, it can be helpful to understand the differences between the two.
Exemption Amount
The amount of the tax exemption is probably the most significant difference between state and federal estate taxes.
In Massachusetts, the estate tax exemption (the value of your estate that won’t be taxed) is $2 million per person. On the federal level, the exemption for 2026 is $15 million per person or $30 million for married couples filing jointly.
Notably, the federal estate tax exemption is adjusted for inflation, while the Massachusetts estate tax exemption isn’t.
Tax Rates
The rates for Massachusetts’s estate tax and the federal estate tax can vary substantially. In Massachusetts, the portion of your estate that exceeds $2 million may be taxed at 0.8%–16%. On the federal level, the portion of your estate that exceeds the exemption may be taxed at 18%–40%.
Portability
The federal estate tax exemption is portable, so if your spouse dies before you, you can use whatever portion of the estate tax exemption ($30 million for married couples in 2026) they didn’t use. If you want to take advantage of the exemption’s portability, you’ll need to file federal Form 706.
Unlike the federal estate tax exemption, the state exemption isn’t portable. If you and your spouse have a combined estate that exceeds $2 million, you should work with a qualified estate planning attorney to establish a trust or credit shelter to protect your wealth.
Filing Deadline
If the value of your estate exceeds $2 million, Massachusetts requires your personal representative to file Form M-706 and pay any tax that may be due within nine months of the date of your death. However, your personal representative can get an automatic six-month extension by paying at least 80% of the estate’s total tax liability in a timely manner.
The deadlines and extensions are similar for federal estate taxes. Your personal representative has nine months from the date of your death to file the estate tax return. They can secure a six-month extension by filing Form 4768 with the IRS.
Note that the six-month extension only extends the time to file the estate tax return, rather than extending the time allotted to pay any taxes that are due.
Estate Planning and Legal Support From an Estate Tax Lawyer
If you anticipate that your estate will exceed Massachusetts’s exemption and/or the federal exemption, it’s a good idea to seek legal help. Otherwise, a sizable portion of your estate may go toward taxes instead of supporting your loved ones.
Keep in mind that not all estate planning lawyers have experience working with clients of substantial means. The team at Jillise McDonough Estate Planning Law Firm is deeply familiar with both Massachusetts and federal estate taxes. We’ll work with you to identify the right strategies to reduce the value of your taxable estate.
These are some of the strategies we may use to help you minimize or avoid estate taxes:
Strategic Gifting
In some cases, you may want to reduce the value of your estate by making gifts to loved ones during your lifetime. For instance, the annual gift exclusion is $19,000 per recipient. Each year, you may make multiple financial gifts that won’t count toward the lifetime gift and estate tax exemption.
Making strategic charitable gifts could help you save on taxes while reducing the value of your taxable estate.
Irrevocable Trusts
Many Boston estate tax attorneys recommend using irrevocable trusts to reduce estate taxes. When you create an irrevocable trust, the assets within it are technically no longer part of your estate.
One common and relatively simple option is an irrevocable life insurance trust (ILIT). This arrangement allows you to remove the proceeds of your life insurance policy from your estate. This means those proceeds won’t be taxed, allowing your heirs to access the funds more quickly.
Credit Shelter Trusts
If you and your spouse are trying to avoid estate tax in Boston, a credit shelter trust (CST) — also called a “bypass trust” — may be the answer.
With a CST, assets over the $2 million Massachusetts estate tax exclusion are placed into a trust after the death of the first spouse. Those assets can eventually be passed down to the couple’s beneficiaries without incurring estate tax.
Although the surviving spouse doesn’t technically own the trust assets, they can usually benefit from any income the trust generates.
The relationship between credit shelter trusts and Massachusetts estate tax laws can be complicated. Your attorney can help you and your spouse decide whether a bypass trust is right for your situation.
Changing Asset Ownership
When dealing with both Boston real estate tax and Massachusetts estate tax, re-titling real estate can be an effective way to reduce estate tax liability.
Transfer-on-death (TOD) deeds allow you to pass a home directly to a beneficiary and skip probate. Transferring real estate and other high-value assets to an irrevocable trust can decrease the taxable value of your estate.
If you want to combine these strategies with gifting, you might also choose to retitle certain assets in your beneficiaries’ names during your lifetime.
Speak With Jillise McDonough Lawyers in Boston
Estate planning is vital for everyone. However, if you think your estate may be subject to state or federal estate taxes, it’s even more important to start working with an attorney as soon as possible.
Not all estate planning law firms have the experience that’s necessary to work with clients with sizable estates or complex asset mixes.
At Jillise McDonough Estate Planning Law Firm, we have guided countless clients through planning for their complex estates. We understand the importance of reducing your taxable estate to keep as much of your hard-earned wealth within your family as possible.
Whether you have an existing estate plan that you want to update or are looking to create one for the first time, our probate and estate tax lawyers are here to help. Contact us today to get started.
Frequently Asked Questions
When Is an Estate Required to Pay Massachusetts Estate Tax?
In Massachusetts, the estate tax is due only if the estate’s value exceeds $2 million. At that point, only the portion of the estate exceeding the $2 million threshold is taxed.
Do I Need an Estate Tax Lawyer in Boston if My Estate Is Under $2 Million?
You may not need a lawyer to help you avoid estate tax if your estate is worth less than $2 million. However, it’s still important to work with an estate planning lawyer to create a solid estate plan. Even if you won’t owe estate tax, the right attorney can still help your heirs avoid probate and ensure that your assets are distributed according to your wishes.
Who Is Responsible for Filing the Massachusetts Estate Tax Return?
If your estate is large enough to trigger the estate tax, your personal representative will typically be responsible for filing a tax return and ensuring the estate pays the amount due. Your personal representative is the executor or administrator of your estate.
What Form Is Used to File Estate Taxes in Massachusetts?
If your estate is worth more than $2 million, your personal representative will need to file Form M-706 (Massachusetts Estate Tax Return).
Are Out-of-State Properties Included in Massachusetts Estate Tax Calculations?
In the past, properties located anywhere in the world were included in the calculation of the Massachusetts estate tax. However, laws passed in 2023 and 2024 changed this. Now, only real estate within Massachusetts is included in the calculation of the Massachusetts estate tax.
Can a Boston Estate Tax Lawyer Help Reduce Estate Taxes Legally?
Yes. Massachusetts residents who think they may owe estate tax can work with an attorney to legally lower the value of their taxable estate. Irrevocable trusts and strategic gifting are two common strategies to achieve this goal.
Does Massachusetts Estate Tax Apply to Non-Residents?
In some cases, yes. If you don’t live in Massachusetts but have real estate or other tangible property within the state, the Massachusetts estate tax may still apply to you. This is usually only a concern if you have high-value real estate in Massachusetts.
Is Estate Tax Planning Only for Wealthy Families in Boston?
Not at all. This is a common misconception. Although you’ll only owe estate taxes if your estate exceeds a certain threshold, estate planning is a good idea for everyone. In Massachusetts, given the value of most properties, owning a home, combined with a life insurance policy, can put you over the threshold without even considering additional assets.
What Happens if Estate Taxes Are Not Paid on Time?
If you have a taxable estate and your taxes aren’t paid on time, the estate may face penalties and interest from the Massachusetts Department of Revenue. The state also won’t release a lien on estate property until the tax return has been filed and all taxes have been properly paid.
