Estate Tax Calculator
Estimate federal estate tax liability and how much your heirs will inherit after taxes.
Enter Details
Results
Related Calculators
Frequently Asked Questions
Who pays federal estate tax in 2026?
Only estates exceeding the federal exemption of $15 million per person ($30 million for married couples with portability election) pay federal estate tax. This means fewer than 0.1% of estates owe any federal estate tax. The top rate is 40% on amounts above the exemption. The One Big Beautiful Bill Act set the exemption at $15 million for 2026.
What is the marital deduction?
The unlimited marital deduction allows you to transfer any amount to a US citizen spouse at death completely free of estate tax. This defers the tax until the surviving spouse dies. The estate then uses the deceased spouses unused exemption (portability) plus their own, potentially shielding $30 million from tax with proper planning.
How can I reduce estate taxes?
Key strategies: annual gifting ($19,000 per recipient per year in 2026, tax-free), irrevocable trusts (removes assets from estate), charitable giving (deductible from taxable estate), life insurance in an ILIT (proceeds outside estate), 529 plans (5-year gift tax election), and family limited partnerships. Work with an estate planning attorney for strategies above $10 million.
Federal estate tax in 2026: who actually pays
The federal exemption is $15 million per person from 2026, indexed for inflation after that, under the 2025 tax law that made the higher exemption permanent. A married couple can shield $30 million with portability. Above the exemption the rate is a flat 40%. Fewer than 0.1% of estates owe anything federally; the state level is where most people with estates between $1 million and $15 million are exposed.
| Taxable estate | Federal tax, single person | Federal tax, married couple (with portability) |
|---|---|---|
| $5,000,000 | $0 | $0 |
| $15,000,000 | $0 | $0 |
| $20,000,000 | $2,000,000 | $0 |
| $30,000,000 | $6,000,000 | $0 |
| $40,000,000 | $10,000,000 | $4,000,000 |
Taxable estate = gross estate minus debts, funeral and administration costs, bequests to a spouse or charity, and lifetime taxable gifts above the annual exclusion are added back.
Worked example
A widow dies in 2026 with a $20 million estate: a $6 million home, $12 million of investments and $2 million of retirement accounts. Her late husband's unused exemption was ported to her, so she has $30 million of exemption and owes no federal estate tax. Without portability (which has to be elected on the first spouse's estate tax return, even when no tax is due) her exemption is $15 million and the tax is 40% of $5 million, $2 million. Filing that return at the first death is the single most valuable step for couples in this range.
State estate and inheritance taxes
Twelve states and the District of Columbia levy an estate tax with exemptions from $1 million (Oregon) and $2 million (Massachusetts) up to about $7 million (New York, with a cliff that taxes the whole estate once it exceeds the exemption by 5%) and $15 million (Connecticut, tied to the federal figure). Rates run up to 16% to 20%. Five states levy an inheritance tax on the recipient instead, with rates that depend on the relationship: Pennsylvania 4.5% for children and 15% for unrelated heirs; Nebraska, Kentucky, New Jersey and Maryland (which has both taxes) are the others, and Iowa repealed its tax in 2025. A $4 million estate in Massachusetts owes about $180,000 of state tax and nothing federal.
What reduces the taxable estate
Annual exclusion gifts of $19,000 per recipient per year, unlimited direct payments of tuition and medical bills, charitable bequests, irrevocable life insurance trusts that keep policy proceeds out of the estate, and for larger estates grantor trusts and family partnerships. Retirement accounts and life insurance owned by the deceased are in the estate even though they pass by beneficiary designation. Assets left to a surviving US citizen spouse are fully deductible, which defers rather than avoids the tax.
The step-up in basis
For almost everyone below the exemption, the estate tax is irrelevant and the step-up matters more: inherited assets take a cost basis equal to their value at death, so a stock bought for $10,000 and worth $500,000 passes with no capital gains tax on the $490,000. Gifting the same stock during life transfers the $10,000 basis and the future gain. This is why the usual advice is to gift cash and hold appreciated assets until death, unless the estate is large enough that the 40% estate tax outweighs the capital gains saving.