The Illinois Estate Tax Issue

Illinois reinstated its estate tax effective January 1, 2011.  All those who have their primary residence (or other real estate) in Illinois at their death may be subject to this tax. Illinois has a $2,000,000 exemption while the federal estate tax exemption is $5,000,000.  In many estate plans created before 2011, this differential can result in Illinois estate tax of up to $352,158 on the death of the first spouse, that could otherwise be deferred or avoided altogether.