Gift Annuity State Regulations

New Jersey


General Definition

Any part of the decedent's estate not effectively disposed of by will passes by intestate succession to the decedent's heirs. Sec. 3B:5-2.

Order of Distribution

The surviving spouse or domestic partner takes the entire intestate estate if no descendant or parent of the decedent survives or all of the decedent's surviving descendants are also descendants of the surviving spouse or domestic partner and there is no other descendant of the surviving spouse or domestic partner who survives the decedent.

Otherwise, the surviving spouse is entitled to:

  1. The first 25% of the intestate estate, but not less than $50,000.00 or more than $200,000.00, plus three-fourths of any balance of the intestate estate, if no descendant of the decedent survives but a parent does.
  2. The first 25% of the intestate estate, but not less than $50,000.00 nor more than $200,000.00, plus one-half of the balance of the intestate estate If all of the decedent's surviving descendants are also descendants of the surviving spouse or domestic partner and the surviving spouse or domestic partner has surviving descendants who are not of the decedent. Or, if the decedent's surviving descendants is not a descendant of the surviving spouse or domestic partner. Sec. 3B:5-3.

Any part not passing to the decedent's surviving spouse or domestic partner passes in the following order:

  1. To the decedent's descendants by representation;
  2. If there are no surviving descendants, to the decedent's parents equally or to the surviving parent;
  3. If there are no surviving descendants or parent, to the descendants of the decedent's parents, by representation;
  4. If there is no surviving descendant, parent or descendant of a parent, but the decedent is survived by one or more grandparents, half of the estate passes to the decedent's paternal grandparents and the other half passes to the decedent's maternal relatives in the same manner.
  5. If there is no surviving descendant, parent, descendant of a parent, or grandparent, but the decedent is survived by one or more descendants of grandparents, the descendants take equally if they are all of the same degree of kinship to the decedent, but if of unequal degree those of more remote degree take by representation. Sec. 3B:5-4.

Will Qualifications

Common Law or Community Property

New Jersey is a common law, elective share state.


Any individual 18 or more years of age who is of sound mind may make a will and may appoint a testamentary guardian. Sec. 3B:3-1.


A will must be in writing, signed by the testator or at the testator's direction and signed by at least two individuals, each of whom signed within a reasonable time after each witnessed either the signing of the will or the testator's acknowledgment of that signature or acknowledgment of the will. However, holographic will are permissible if the signature and material portions of the document are in the testator's handwriting. Sec. 3B:3-2.


An "heir" is any person, including the surviving spouse or domestic partner, entitled under the statutes of intestate succession to the property of a decedent. Sec. 3A:25-39.


A will or any part thereof can be revoked by the creation of a subsequent will that revokes the previous will or part expressly or by inconsistency. Alternatively, a will or portion thereof may be revoked by the performance of a revocatory act on the will, if performed with the intention of revoking the will or part of the will. "Revocatory acts" include burning, tearing canceling, obliterating or destroying the will or any part of it. Sec. 3B:3-13.

Upon the divorce of a married couple, the portion, if any, of each individual's will making transfers of assets, rights, powers or duties to the other is revoked. Sec. 3B:3-14.

No clause of a will can be altered, except by another will, codicil or other writing declaring the alteration and executed in the same manner as required by wills. Sec. 3B:3-16.

Probate Process

Naming of Personal Representative

If a person dies intestate, administration of the estate will be granted to the surviving spouse or domestic partner. If the surviving spouse refuses to administer, then the remaining heirs will be granted letters. If no heirs are left or if no heir claims the right of administration within 40 days after the death of the intestate, the Superior Court may grant letters of administration to any fit person. Sec. 3B:10-2.

If the decedent died with a valid will, letters of administration will be granted to the party named in the will. Sec. 3B:10-16.

Submission of Will

To be effective, a will must be admitted to probate. Sec. 3B:3-18.

A will may be admitted to probate by the holder of the will. It must be acknowledged by one of the attesting witnesses or by some other individual having knowledge of the facts. If the testator filed the will with the state under the state's will registry service, no acknowledgement by an attesting witness is necessary. Sec. 3B:3-19.

A will may not be admitted to probate sooner than 10 days after the death of the testator. However, the complaint and other papers in any action for probate may be filed, the depositions of the witnesses and the qualification of the executor or administrator taken at any time subsequent to the death of the testator and before the will is admitted to probate. Sec. 3B:3-22.


After the probable charges against the estate are known, the personal representative may mail or deliver a proposal for distribution to all persons who have a right to object to the proposed distribution. The proposal must notify all persons of their right to object and that their objection must be in writing and received by the personal representative within 30 days after the mailing or delivery of the proposal. Sec. 3B:23-4.


The personal representative must make and file an inventory of the real and personal property of the decedent and obtain an appraisal made by two discreet and impartial persons. Sec. 3B:16-2.

Family Allowance and the Elective Share

The clothes and personal property of a decedent valued at $5,000.00 or less is given to family. The right to this property is superior to all creditors and must occur before any distribution of the estate is made. Sec. 3B:16-5. The surviving spouse or domestic partner must give notice of the time and place set for hearing to persons interested in the estate and to the distributees and recipients of portions of the augmented estate whose interests will be adversely affected by the taking of the elective share. Sec. 3B:8-13.

The Superior Court may, on application by the widow or widower or by any of decedent's children order the person having the custody of the decedent's estate to pay out of the income of the estate an allowance for the support and maintenance of the widow, widower, child or children as the court may deem just. Sec. 3B:3-30.

If a married person or person in a domestic partnership dies domiciled in New Jersey, the surviving spouse or domestic partner has a right of election to take 1/3 of the augmented estate, provided that at the time of death the decedent and the surviving spouse or domestic partner had not ceased to cohabit. Sec. 3B:8-1.

Debts and Distributions

If the assets of the estate are insufficient to pay all claims in full, the personal representative will make payment in the following order:

  1. Reasonable funeral expenses;
  2. Costs and expenses of administration;
  3. Debts for services rendered to the decedent by the Office of the Public Guardian for Elderly Adults;
  4. Debts and taxes with preference under federal law or the laws of New Jersey;
  5. Reasonable medical and hospital expenses of the last illness of the decedent, including compensation of attending persons;
  6. Judgments entered against the decedent according to the priorities of their entries respectively;
  7. All other claims. Sec. 3B:22-2.

Creditors must present their claims to the personal representative in writing and under oath, specifying the amount claimed and the particulars of the claim, within nine months from the date of the decedent's death. If a claim is not presented within nine months, the personal representative will not be liable to the creditor with respect to any assets which the personal representative may have delivered or paid in satisfaction of any lawful claims, devises or distributive shares, before the presentation of the claim. Sec. 3B:22-4.

If full payment of debts and claims is made and there remains a residue, the residue will be divided among the heirs in the proportions as provided by law, or in case of a will, to the devisees as the will directs. Sec. 3B:22-37.

Except where a will authorizes distribution to be made in cash or in kind, the distributable assets of an intestate's estate or testator's estate will be distributed in kind to the extent possible. A specific devisee is entitled to distribution of the thing devised to him. Any devise payable in money or an intestate share may be satisfied by value in kind provided that the person entitled to the payment has not demanded payment in cash, the property distributed in kind is valued at fair market value as of the date of its distribution and no residuary devisee has requested that the asset in question remain a part of the residue of the estate. Sec. 3B:23-1.

Estate/Inheritance Tax

In 2018, New Jersey's estate tax was eliminated entirely. P.L.2016, c.57.

New Jersey applies an inheritance tax to all transfers of real and personal property within the state on values that exceed $500. Sec. 54:34-1. The transfer of property to a surviving spouse or domestic partner, parent, grandparent, child or adopted child is exempt. The graduated tax ranges from 11% to 16% and is applied in connection with the beneficiary's relation to the decedent. Sec. 54:34-2.

Income Tax Charitable Deductions and/or Credits

New Jersey does not offer taxpayers a deduction for most contributions to charitable organizations. Taxpayers who contribute real property for a qualified conservation easement in New Jersey are able to take a deduction against their state income tax. Sec. 54A:3-6.

Gift Annuity Requirements

New Jersey, a "registration" state, regulates the issuance of charitable gift annuities under Sec. 17B:17-13.1. Charities must apply for a Special Annuity Permit from the Department of Banking and Insurance before issuing charitable gift annuities in this state.

To qualify, applying charities must have been in continuous operation for at least 10 years. The charity must be registered with the Department of the Treasury and with the Department of Law and Public Safety, Division of consumer Affairs, Charities Registration Section.

If you are offering the new IRA to CGA rollover option, updated contracts may need to be submitted for approval. If you adopt the ACGA rate schedule, you may need to submit an updated rate schedule when new rates are issued.

Application Process

To obtain a Special Permit, the charity must submit a detailed application. The Application fee is $100. The Application for Special Annuity Permit by Charitable, Religious, Missionary, Educational or Philanthropic Corporations or Associations must include: a board resolution regarding the segregation of assets, various corporate documents (articles of incorporation and bylaws), evidence of active operation for the required period, evidence of tax-exempt status, the most recently filed Form 990, information on annuity payout rates, an operations and investment plan for the segregated fund, an organizational chart, the most recent independent auditors report, reserves calculation from an actuary, sample gift annuity agreements and an annual statement. The applicant must also provide current proof of registration with both the Department of Treasury (authorized to conduct business in the state) and the Department of Law and Public Safety, Division of consumer Affairs (registered as a charity in the state). For the reserves calculation, charities using Crescendo software are exempt from having to provide the actuarial verification (the charity need only certify it uses Crescendo software and has the expertise to run it). All gift annuity agreements are to be included using a 'John Doe' format, assigned numbers for each form of agreement, page numbers and the agreement form publication date (month/year) visible on each page. Charities not following the ACGA schedule of annuity payout rates must submit their own rates verified by an actuary to ensure compliance with Sec. 17B:17-13.1(a) and New Jersey Administrative Code Sec. 11:4-8.3(c).

Disclosure Language

New Jersey does not specify any required state-specific disclosure language.

Reserve Requirements

A registering charity must maintain a segregated reserve account fund. The segregated fund must maintain the reserves amount (present value of annuity payments on all outstanding annuity agreements) plus a surplus the greater of: (i) $100,000; or (ii) 10% of the required reserves. The segregated fund should be invested according to the New Jersey Administrative Code Sec. 11:4-8.6(a)(2).

Annual Filing Requirements

Once a Special Permit is granted, New Jersey requires annual filings be continually submitted to the Insurance Department within 120 days of the end of each calendar year (or fiscal year if the charity has obtained permission to file on that basis). New Jersey Administrative Code Sec. 11:4-8.8. These filings renew the Special Permit each year by providing the state with an annual report of the segregated fund accompanied by an actuarial verification of the reserves (unless exempted from this requirement with use of Crescendo software as above). The charity must also submit the most recent audited financial statement and a reserves report.

State Contact Information

June A. Duggan
Department of Banking & Insurance
Office of Solvency Regulation
8th Floor
20 West State Street
P.O. Box 325
Trenton, NJ 08625-0325
phone: 609-292-5350 ext. 50326
e-mail: [email protected]

State Forms

For more information on state-specific form requirements, please contact Crescendo at 800-858-9154.

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