Tax laws require federal and state estate taxes, and many advisers have put their major focus focus on the federal level in the past. However, with the exemption rising to $5.25 million - unused amounts can be transferred to a surviving spouse - many people actually don't end up paying federal estate tax, according to The Wall Street Journal. For this reason, it might be time to put more of a focus on the state level. Estate and inheritance taxes are levied by 19 states and Washington, D.C., and can be as high as 19 percent. Each state generally offers its own exemptions. For example, New Jersey's is $675,000. One of the biggest decisions for a person in regards to the estate tax is where they should retire. With different laws in different states, it might be a good idea for individuals to move somewhere that has more relaxed laws, so the money and other assets left for their families isn't highly taxed. New York is one state that is currently undergoing major changes to its estate tax. According to Forbes, the Empire State could ease its tax laws as early as next year, which may help keep retirees from fleeing the area during retirement. The state estate tax would not be eliminated, however - it would come into play at a higher level of wealth and at a lower rate, which could save people money when passing on assets to children and spouses. The current exemption sits at $1 million, but that will rise to $5.34 million when the changes take place. Any amounts above that would be taxed 10 percent, which would be a decrease from the 16 percent that is levied now.