Chalk it up to the slow down in the economy - effective for deaths ocurring on or after July 1, 2009, Delaware will collect a state estate tax. Prior to this date, Delaware, like 32 other states, lost its portion of a decedent's federal estate tax bill when the "pick up tax" was completely phased out under federal law for deaths occurring on or after January 1, 2005. But now Delaware has joined the ranks of the District of Columbia and Connecticut, Illinois, Kansas, Maine, Maryland, Massachusetts, Minnesota, New Jersey, New York, North Carolina, Ohio, Oklahoma, Oregon, Rhode Island, Tennessee, Vermont, and Washington in collecting a state estate tax.
The new Delaware estate tax applies to estates with values in excess of $3,500,000 and is tied to federal estate tax laws that were in effect on January 1, 2001. For the estates of nonresidents who own real estate or tangible personal property located in Delaware, their estates will be taxed on a proportionate basis with regard to their assets located inside and outside of Delaware.