Question: The District of Columbia seems to be one of the last holdouts in revamping its estate tax laws to coincide with the increased federal estate tax credit. Has D.C. considered modifying its estate tax credit (currently $1,000,000 per person) to parallel with the higher federal estate tax exemption amount?
Answer: In 2014, the Washington, D.C. City Council passed a tax reduction bill that provided for certain taxes to be reduced if projected revenues reached specified thresholds. I understand that there were twenty-six possible tax reductions and the increase in the exemption for D.C. estate taxes from $1,000,000 to 2,000,000 was not high on the list (the 15th priority).
Apparently, the projected revenue increase in D.C. for 2016 will not be enough to cause an exemption increase for D.C. estate taxes. The amount then that will pass free for D.C. estate tax will remain at $1,000,000 for individuals dying in 2016 (and previously).