Numerous states enacted estate tax programs which supplemented the federal estate income tax laws. Known as “pick-up” taxes, state estate tax programs typically picked up where federal taxes left-off. Therefore, because the majority of estates did not owe federal earnings taxes, a small number of Floridians paid state pick-up estate taxes.
According to the pick-up tax program, estates with overall gross values below federal estate income tax limits were not needed to pay Florida estate taxes. Nevertheless, the Florida Legislature removed most pick-up taxes after Congress amended the federal Internal Earnings Code to offer state death tax credits to eligible taxpayers. How do these estate tax law modifications affect residents?
Residents who are required to file federal estate tax returns on the estates of decedents who passed away before Dec. 31, 2004, should also file Florida estate tax returns. For estates required to file federal estate tax returns for deaths that occurred after this date should file an “Affidavit of No Florida Estate Tax Due When Federal Return if Needed” if they did not owe federal taxes however simply had to file them. For personal agents of estates who are not required to pay or file federal estate tax returns, Florida law needs them to file an “Affidavit of No Florida Estate Tax Charge.”
This indicates that whether you are needed to submit an estate tax return in Florida depends on whether you are needed to submit one with the Irs. Pursuant to the Internal Profits Code, you are not required to submit an estate tax return as a personal representative unless the worth of the decedent’s estate surpasses the annual limit as established by Congress. For the 2011 tax year, the estate tax filing limit is $5 million.