This bill amends the New Jersey Transfer Inheritance Tax Act to eliminate the transfer inheritance tax for step-grandchildren of a decedent. It reclassifies step-grandchildren, treating them the same as stepchildren and grandchildren, which are classified as Class A beneficiaries under the law. The new legal language specifies that the transfer of property to step-grandchildren will be taxed at the same rates and with the same exemptions as property transfers to a decedent's children born in lawful wedlock.

Currently, step-grandchildren are classified as Class D beneficiaries, subjecting them to a transfer inheritance tax of 15% on property transfers up to $700,000 and 16% on amounts exceeding that threshold. By reclassifying step-grandchildren as Class A beneficiaries, the bill ensures that they will not be subject to any transfer inheritance tax, aligning their treatment with that of stepchildren and grandchildren. The act is set to take effect on January 1, 2025.