Quick answer: up to 10.75% state tax, among the highest in the nation, with no long-term discount and no loss carryovers to soften it. See the full cost picture in the New Jersey probate real estate sale calculator.
One of the highest top rates in the country
No loss carryovers, no $3,000 offset
Unlike federal law, New Jersey doesn't allow unused capital losses to carry forward to future tax years, and doesn't let capital losses offset up to $3,000 of ordinary income the way the IRS does — a real, distinctive limitation worth knowing if the estate has other investment losses to consider.
No state estate tax, but inheritance tax remains
New Jersey repealed its state estate tax, but it still levies an inheritance tax based on the beneficiary's relationship to the decedent — a completely separate calculation from the capital gains tax on a later sale.
The stepped-up basis still helps
Regardless of New Jersey's rate structure, the house's basis resets to its fair market value on the date of death for federal purposes, and New Jersey's calculation follows that same starting point — only appreciation after death is taxable, keeping the gain small on a prompt sale.
A local probate attorney can review your estate — many offer a free consultation.
The 10.75% top rate applies identically whether the sale closes in Bergen, Essex, Middlesex, or any other New Jersey county — New Jersey has no local income tax layered on top.