As of September 2026, the federal estate tax exemption is set at $15 million per person. Congress made that higher exemption permanent instead of allowing it to fall under a scheduled sunset.

That is important news.

It is also easy to misunderstand.

The federal exemption does not replace New York’s estate tax rules. New York has its own estate tax. Its exemption is much lower. It also uses a structure commonly called the New York estate tax cliff.

For 2026, New York’s basic exclusion amount is $7.35 million for deaths occurring between January 1 and December 31, 2026, according to the New York State Department of Taxation and Finance.

If you live in Buffalo or Erie County, own a home in Western New York, or split your time between New York and Florida, this distinction matters.

What Is the Federal Estate Tax?

The federal estate tax applies to the transfer of property after death.

The federal government generally looks at the value of your gross estate, which can include:

Real estate
Bank accounts
Investment accounts
Life insurance
Business interests
Retirement accounts
Trust interests
Other property and financial interests

Certain deductions may apply. These can include debts, administration expenses, charitable transfers, and qualifying transfers to a surviving spouse.

For 2026, the federal basic exclusion amount is $15 million per person. The IRS estate tax page lists the 2026 federal filing threshold at $15 million.

A married couple may have access to two federal exemptions. However, the surviving spouse generally must make a timely portability election through a federal estate tax return to preserve the deceased spouse’s unused exemption.

That federal rule does not automatically carry over to New York.

What Is the New York Estate Tax?

New York has a separate estate tax system.

For deaths in 2026, New York’s basic exclusion amount is $7,350,000. This amount is published by New York each year and may change as the law and applicable adjustments change.

The New York calculation can also involve:

The federal gross estate
Certain taxable gifts made during the three years before death
Deductions
New York-specific elections
The decedent’s residency
The location of real and tangible property

This means the number you use for federal planning may not be the number you use for New York planning.

A person may be below the federal estate tax threshold but still have a New York estate tax concern.

The New York Estate Tax Cliff Explained

Many states tax only the portion of an estate above the exemption. New York’s system can be more complicated.

New York uses a cliff structure. In general terms:

An estate at or below the basic exclusion amount may receive the full applicable credit.
An estate slightly above the exclusion amount enters a phase-out range.
Once the estate exceeds approximately 105% of the basic exclusion amount, the applicable credit may be eliminated.
The estate may then face New York estate tax calculated on the full applicable New York taxable estate, rather than only the amount above the exemption.

For 2026, 105% of New York’s $7,350,000 basic exclusion amount is approximately $7,717,500.

This is a simplified explanation. The actual calculation can depend on the estate’s assets, deductions, includible gifts, ownership structure, and other facts. The executor must use the correct version of New York Form ET-706 and its instructions.

Hypothetical example: A Buffalo resident dies with an estate that falls just above the New York exclusion amount. The family assumes only the excess will be taxed. They later learn that the New York cliff structure can affect the credit applied to the estate. The result depends on the detailed calculation, but the family now faces a tax issue they did not expect.

The key point is simple: being only slightly above New York’s exemption can create a disproportionately serious estate tax concern.

Federal Portability Does Not Solve the New York Problem

Federal law may allow a surviving spouse to use a deceased spouse’s unused federal estate tax exemption. This is called portability.

New York does not follow federal portability for New York estate tax purposes.

That creates a planning gap for married couples.

Consider a couple with a combined estate worth $10 million. They may be well below the combined federal exemption of approximately $30 million, assuming proper federal planning and portability. But their estate may still need careful review under New York law because New York’s exclusion is much lower and the state does not provide the same portability benefit.

A New York resident may not automatically preserve one spouse’s unused New York exclusion for the survivor.

This is one reason a federal estate tax headline should not lead you to ignore your state-level plan.

Why This Matters for New York and Florida Snowbirds

Many families in Western New York own property in both New York and Florida.

You may have:

A primary home in Buffalo or another Erie County community
A winter residence in Clearwater, Dunedin, St. Petersburg, Largo, Safety Harbor, or Bradenton
Bank and investment accounts connected to New York
Retirement accounts and life insurance
Property titled individually, jointly, or through a trust

Your Florida property does not automatically remove you from New York’s estate tax system. Residency and domicile involve more than the number of days you spend in each state. Your facts may include your home, voter registration, driver’s license, tax filings, family connections, and other evidence of where you consider your permanent home.

For a New York resident, the estate tax analysis generally begins with the person’s federal gross estate and includible gifts.

For a nonresident, New York may still have an interest in New York real property and tangible personal property located in New York. The rules are technical, and ownership through a trust or entity may affect the analysis.

That means a Florida residence does not automatically make New York planning irrelevant. It may make coordinated planning more important.

Estate Tax Planning and Probate Planning Are Different

Estate tax planning and probate planning are related, but they are not the same.

A Will may direct where your property goes. It generally does not keep that property out of probate.

A properly structured and maintained revocable living trust may help coordinate property in more than one state. It may also help your family avoid separate probate proceedings for individually owned real estate.

Tax planning requires a different analysis. Moving assets into a trust does not automatically remove them from your taxable estate. A revocable trust is usually designed to preserve your control during life, which commonly means the assets remain part of your estate for tax purposes.

The goal is not to use a trust simply because the federal exemption is high. The goal is to coordinate:

Your state residency and domicile
Your New York and Florida real estate
Asset ownership and titling
Beneficiary designations
Marital planning
Life insurance
Lifetime gifts
Incapacity documents
Probate avoidance
Family communication and administration

What You Can Review This Fall

The federal estate tax change is a good reason to review your plan. It is not a reason to put planning aside.

Start with these questions:

What is the current value of your estate?
Include real estate, retirement accounts, life insurance, business interests, investments, and personal property.
Which state considers you a resident or domiciliary?
Your seasonal routine does not answer this question by itself.
Do you own real property in both states?
Check how each property is titled.
Are your beneficiary designations current?
Retirement accounts and life insurance may pass outside your Will, but outdated designations can still create problems.
Did your spouse previously die with unused New York exclusion?
New York does not provide the same portability treatment as federal law.
Have you made significant gifts?
Certain gifts may affect the estate tax calculation, including New York’s rules on includible gifts.
Is your existing plan more than a few years old?
Your family, assets, residency, and the law may have changed.

New York estate tax returns and payment are generally due within nine months of death. The New York Tax Department’s estate tax page provides current filing requirements, forms, and official guidance.

How Life & Legacy Planning Can Help

At Santopolo Law, PLLC, we look beyond the federal exemption number.

Our Life & Legacy Planning® approach begins with your family, your assets, your concerns, and the way you actually live. For families connected to both New York and Florida, we review the state-line issues that may affect your plan.

That may include:

Reviewing your New York and Florida real estate
Identifying how assets are titled
Coordinating Wills, trusts, and beneficiary designations
Discussing incapacity planning
Reviewing potential New York estate tax exposure
Identifying gaps in an older plan
Helping your family understand the choices available
Connecting you with tax professionals when tax-return preparation or specialized tax advice is needed

Anthony C. Santopolo Jr. is admitted to practice law in New York and Florida. We serve families in Western New York and Florida’s Gulf Coast corridor, including Buffalo, Erie County, Clearwater, St. Petersburg, Dunedin, Largo, Safety Harbor, and Bradenton.

Do Not Let a Federal Headline Create a State-Level Blind Spot

The federal estate tax exemption is now much higher. That may reduce federal estate tax exposure for many families.

New York’s estate tax is a separate matter.

With a lower exclusion, a cliff structure, and no New York portability, the state-level analysis can be important even when federal estate tax feels far away. This is especially true for families with valuable homes, multiple properties, retirement assets, life insurance, or a New York and Florida connection.

You do not need to solve every issue alone. Start by gathering your current asset information and reviewing whether your documents still match your life.

Contact Santopolo Law, PLLC to schedule a conversation about your Life & Legacy Plan.

Official Resources

Important Disclaimer

This article provides general information only. It is not legal advice, tax advice, or a substitute for advice about your specific circumstances. Estate tax laws, regulations, filing requirements, and government policies can change. Laws also vary by state and may apply differently based on residency, domicile, asset ownership, family circumstances, and other facts. Reading this article does not create an attorney-client relationship with Santopolo Law, PLLC.

Santopolo Law, PLLC
300 International Dr., Ste. 100
Buffalo, NY 14221

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