The New York estate tax is calculated quite differently from the federal estate tax. Generally, for New York estate tax purposes, if the estate value is below a certain threshold ($7.35 million in 2026), the assets are fully exempt from tax, and no New York estate taxes will be due. However, the exemption begins to phase out at values over the threshold, and if an estate is more than 5% over the threshold (which is $7,717,500 in 2026), the estate completely loses the exemption and the full value of the estate’s assets will be subject to New York estate tax. Because of this drastic drop in estate tax protection for estates over the New York threshold, the New York estate tax is often called a “cliff tax.” Estates whose values fall between the threshold amount and the 5% excess will be partially subject to New York estate tax.
