Massachusetts 2023-2024 Regular Session

Massachusetts House Bill H2720 Compare Versions

Only one version of the bill is available at this time.

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1	1	1 of 1
2	2	HOUSE DOCKET, NO. 3775 FILED ON: 1/20/2023
3	3	HOUSE . . . . . . . . . . . . . . . No. 2720
4	4	The Commonwealth of Massachusetts
5	5	_________________
6	6	PRESENTED BY:
7	7	Nicholas A. Boldyga
8	8	_________________
9	9	To the Honorable Senate and House of Representatives of the Commonwealth of Massachusetts in General
10	10	Court assembled:
11	11	The undersigned legislators and/or citizens respectfully petition for the adoption of the accompanying bill:
12	12	An Act relative to the Massachusetts estate tax code.
13	13	_______________
14	14	PETITION OF:
15	15	NAME:DISTRICT/ADDRESS :DATE ADDED:Nicholas A. Boldyga3rd Hampden1/19/2023 1 of 7
16	16	HOUSE DOCKET, NO. 3775 FILED ON: 1/20/2023
17	17	HOUSE . . . . . . . . . . . . . . . No. 2720
18	18	By Representative Boldyga of Southwick, a petition (accompanied by bill, House, No. 2720) of
19	19	Nicholas A. Boldyga relative to the estate tax code of the Commonwealth. Revenue.
20	20	[SIMILAR MATTER FILED IN PREVIOUS SESSION
21	21	SEE HOUSE, NO. 2881 OF 2021-2022.]
22	22	The Commonwealth of Massachusetts
23	23	_______________
24	24	In the One Hundred and Ninety-Third General Court
25	25	(2023-2024)
26	26	_______________
27	27	An Act relative to the Massachusetts estate tax code.
28	28	Be it enacted by the Senate and House of Representatives in General Court assembled, and by the authority
29	29	of the same, as follows:
30	30	1 SECTION 1. Chapter 65C of the General Laws is hereby amended by striking out
31	31	2Section 1(a), as appearing in the 2012 Official Edition, and inserting in place thereof the
32	32	3following section:-
33	33	4 (a) “Code”, the Internal Revenue Code of the United States, in effect for the taxable year
34	34	5 SECTION 2. Chapter 65C of the General Laws is hereby amended by striking out
35	35	6Section 1(d), as appearing in the 2012 Official Edition, and inserting in place thereof the
36	36	7following section:-
37	37	8 (d) "Federal Gross Estate", the gross estate as defined under the code. 2 of 7
38	38	9 SECTION 3. Chapter 65C of the General Laws is hereby amended by striking out
39	39	10Section 1(f), as appearing in the 2012 Official Edition, and inserting in place thereof the
40	40	11following section:-
41	41	12 (f) “Massachusetts gross estate”, the federal gross estate, whether or not a federal estate
42	42	13tax return is required to be filed, plus the value of any property: (i) in which the decedent had at
43	43	14death a qualifying income interest for life described in subsection (c) of section 3A, or to the
44	44	15extent of any such interest therein of which the decedent has at any time made a transfer, by trust
45	45	16or otherwise, under any circumstances which would require the property to be included in the
46	46	17gross estate under the provisions of this chapter; and (ii) for which a deduction was allowed for
47	47	18Massachusetts estate tax purposes with respect to the transfer of such property to the decedent;
48	48	19and less the value of real and tangible personal property having an actual situs outside the
49	49	20commonwealth, but not the value of the principal residence of the decedent unless elected
50	50	21pursuant to the provisions of subsection (f) of section 2. The Massachusetts gross estate shall not
51	51	22include the value of any property in which the decedent had a qualifying income interest for life
52	52	23which is not otherwise includible in the Massachusetts gross estate under the first sentence of
53	53	24this subsection, notwithstanding the right of the executor of the decedent's estate to recover
54	54	25federal or Massachusetts estate taxes from such property.
55	55	26 SECTION 4. Chapter 65C of the General Laws is hereby amended by striking out
56	56	27Section 1(h), as appearing in the 2012 Official Edition, and inserting in place thereof the
57	57	28following section:-
58	58	29 (h) “Massachusetts taxable estate”, the Massachusetts gross estate less the exemption or
59	59	30the exclusions provided for within this section and deductions allowable under chapter 65C. 3 of 7
60	60	31 SECTION 5. Chapter 65C of the General Laws is hereby amended by striking out
61	61	32Section 1(j), as appearing in the 2012 Official Edition, and inserting in place thereof the
62	62	33following section:-
63	63	34 (j) “Applicable exclusion amount”, the sum of (i) the basic exclusion amount, and (ii) in
64	64	35the case of a surviving spouse, the deceased spousal unused exclusion amount.
65	65	36 SECTION 6. Chapter 65C of the General Laws is hereby amended by striking out
66	66	37Section 1(k), as appearing in the 2012 Official Edition, and inserting in place thereof the
67	67	38following section:-
68	68	39 (k) “Basic exclusion amount”, $2,750,000 which shall be annually adjusted for inflation
69	69	40based on the US Department of Labor’s Consumer Price Index (CPI) for All Urban Consumers.
70	70	41If the amount as adjusted under the preceding sentence is not a multiple of $10,000, such amount
71	71	42shall be rounded to the nearest multiple of $10,000.
72	72	43 SECTION 7. Chapter 65C of the General Laws is hereby amended by striking out
73	73	44Section 2 and Section 2A in their entirety, as appearing in the 2012 Official Edition, and
74	74	45inserting in place thereof the following section:-
75	75	46 Section 2. (a) A tax is hereby imposed upon the transfer of the estate of each person
76	76	47dying on or after January 1, 2022 who, at the time of death, was a resident of the commonwealth.
77	77	48This subsection shall only apply to each person dying on or after January 1, 2022. For the estate
78	78	49of decedents dying prior to January 1, 2022, they shall be subject to the provisions of chapter
79	79	5065C of the general laws in effect upon the date of death of such decedent. 4 of 7
80	80	51 (b) A tax is hereby imposed upon the transfer of real property situated in this
81	81	52commonwealth and upon tangible personal property having an actual situs in this commonwealth
82	82	53of every person who at the time of his or her death was not a resident of this commonwealth.
83	83	54 (c) Notwithstanding any other provision of law, the tax imposed by subsections (a) and
84	84	55(b) shall be computed upon the value of any property subject to a power of appointment which is
85	85	56includible in the federal gross estate, notwithstanding that a tax has been paid thereon pursuant to
86	86	57section 14 of chapter 65.
87	87	58 (d) For the purposes of computing the tax imposed by subsections (a) and (b) of this
88	88	59section the amount of the tax shall be computed with respect to the Massachusetts taxable estate
89	89	60in accordance with the following table:-
90	90	61 [TABLE 1]
91	91	62 (e) A tax is hereby imposed upon the transfer of real property situated in this
92	92	63commonwealth and upon tangible personal property having an actual situs in this commonwealth
93	93	64of every person who at the time of his death was not a resident of this commonwealth. The
94	94	65amount of this tax shall be computed with respect to the value of Massachusetts real and tangible
95	95	66personal property in accordance with the following table:-
96	96	67 [TABLE 2]
97	97	68 (f) The principal residence of a deceased person who, at the time of their death, was a
98	98	69resident of the commonwealth shall be excluded in such person’s Massachusetts gross estate
99	99	70subject to the exclusion requirements of section 121 of the Code, provided that such residence
100	100	71has been owned and used by such person as his or her principal residence for periods aggregating 5 of 7
101	101	72two years or more during the five-year period ending on the date of such person’s death.
102	102	73Ownership shall include, but not be limited to, sole ownership, joint ownership, ownership via a
103	103	74funded revocable trust or nominee trust, or other such vehicles as determined by the Department
104	104	75of Revenue. The executor may elect to include the value of such deceased person’s residence in
105	105	76such person’s Massachusetts gross estate. This election shall be made by the executor on the
106	106	77Massachusetts estate tax return filed within the time prescribed for filing such return, or any
107	107	78extension of such time granted by the commissioner. Such election, once made, shall be
108	108	79irrevocable.
109	109	80 (g) The maximum exclusion value of a person's principal residence allowed to be
110	110	81deducted from their Massachusetts net estate may not exceed the amount of the basic exclusion
111	111	82amount as defined in section 1. This deduction is separate and distinct from the basic exclusion
112	112	83amount and both may be deducted from the net estate to determine the taxable estate.
113	113	84 (h) The basis of property, for Massachusetts estate tax purposes, acquired from the
114	114	85decedent shall be the basis computed pursuant to section 1014 of the Code.
115	115	86 (i) A person who, at the time of death, was a resident of the commonwealth and whose
116	116	87deceased spouse was a resident of the commonwealth may elect to apply the deceased spousal
117	117	88unused exclusion amount to the Massachusetts gross estate. This exclusion shall be made by the
118	118	89executor on the Massachusetts estate tax return filed within the time prescribed for filing such
119	119	90return, or any extension of such time granted by the commissioner. Such election, once made,
120	120	91shall be irrevocable.
121	121	92 (j) Notwithstanding any other provision of law, the tax imposed by subsections (b) and
122	122	93(c) shall be computed upon the value of any property subject to a power of appointment which is 6 of 7
123	123	94includible in the federal gross estate, notwithstanding that a tax has been paid thereon pursuant to
124	124	95section 14 of chapter 65.
125	125	96 (k) For the purposes of computing the tax imposed by subsections (b) and (c) of this
126	126	97section, the provisions of section 3 shall not apply.
127	127	98 (l) The commissioner of revenue may make determinations and shall prescribe such
128	128	99regulations as may be necessary or appropriate to carry out this subsection.
129	129	100 (m) For the estate of decedents dying on or after January 1, 2022 all references and
130	130	101provisions in subsection (b) to the Internal Revenue Code or Code, unless the context clearly
131	131	102indicates otherwise, shall be to the Code as in effect for the taxable year.
132	132	103 SECTION 8. Chapter 65C of the General Laws is hereby amended by adding the
133	133	104following section after Section 3(d), as appearing in the 2012 Official Edition:- (e) “Deceased
134	134	105spousal unused exclusion amount”, with respect to a surviving spouse of a deceased spouse
135	135	106dying on or after January 1, 2022 and subject to paragraph 5 of section 2010 of the Code, the
136	136	107lesser of (i) the basic exclusion amount or (ii) the excess of the applicable exclusion amount of
137	137	108the last such deceased spouse of such surviving spouse, over the amount with respect to which
138	138	109the Massachusetts estate tax is determined under subsection (b) of the estate of such deceased
139	139	110spouse.
140	140	111 SECTION 9. Chapter 65C of the General Laws is hereby amended by striking out in
141	141	112Section 3A(f), as appearing in the 2012 Official Edition, the line “Such election, once made,
142	142	113shall be irrevocable and shall be separate from and independent of any election made by the
143	143	114executor for federal estate tax purposes” and inserting in place thereof the following:- “If no
144	144	115Massachusetts estate tax return is timely filed, such election may be made on the first return filed 7 of 7
145	145	116by the executor after the due date. Such election, once made, shall be irrevocable. The executor
146	146	117is not required to have made the same qualified terminable interest property election for federal
147	147	118estate tax purposes in order to make the election for Massachusetts purposes.”
148	148	119 SECTION 10. Chapter 65C of the General Laws is hereby amended by striking out in
149	149	120Section 4(b), as appearing in the 2012 Official Edition, in its entirety.
150	150	121 SECTION 11. Chapter 65C of the General Laws is hereby amended by striking out in
151	151	122Section 4A, as appearing in the 2012 Official Edition, in its entirety.