Estate Tax Calculator

This estate tax calculator adds up what a person owns, subtracts what they owe, and compares the result with the federal exemption for the year of death. The figures loaded on this page total a $222,200 gross estate, take off $12,500 of debts and charitable gifts, and leave a net taxable estate of $209,700. Against the 2026 exemption of $15 million, the federal estate tax due is $0. The table underneath shows every exemption and top rate since 2001, and the charts break the estate into its parts.

What the federal estate tax actually is

The estate tax is charged on the value of everything a person owns at death, and only on the slice above the exemption. In 2026 that exemption is $15 million per person, made permanent and indexed for inflation by legislation passed in 2025, and the rate on anything above it is 40%. An estate of $20 million pays 40% on $5 million, which is $2 million, and nothing on the first $15 million.

Almost nobody pays it. Estate and gift taxes together raised roughly $32 billion in 2024, a rounding error against the trillions that pass between generations each year, and well under 1% of deaths produce a taxable estate. The tax is easy to reduce legally, too: assets left to a spouse or a charity are deducted in full, valuation discounts shrink the taxable figure on family businesses, and trusts move assets out of the estate years before death. What the calculator gives you is the federal starting point, which for most families is the confirmation that no return is due at all.

Estate tax and inheritance tax are not the same

The difference is who writes the cheque. Estate tax comes out of the estate before anything is distributed, so the executor pays it and the heirs receive what is left. Inheritance tax is charged to each beneficiary on what they personally receive, and the rate usually depends on how closely related they were to the deceased. The federal government levies an estate tax and no inheritance tax at all.

States run their own systems, and the map has shrunk in recent years. Twelve states plus the District of Columbia charge an estate tax: Connecticut, Hawaii, Illinois, Maine, Maryland, Massachusetts, Minnesota, New York, Oregon, Rhode Island, Vermont, and Washington. Five charge an inheritance tax: Kentucky, Maryland, Nebraska, New Jersey, and Pennsylvania. Maryland is the only state with both. Iowa finished phasing its inheritance tax out after 2024 and Delaware repealed its estate tax in 2018, so older lists that name them are out of date. FindLaw keeps a plain-language summary of state estate tax laws if you want to check the rules where you live.

State thresholds are the part that catches people. Oregon starts taxing at $1 million and Massachusetts at $2 million, so an estate that owes nothing federally can still owe a state bill on a house and a retirement account. Washington's top rate reaches 20%. Where inheritance tax applies, a surviving spouse is exempt everywhere and children usually pay little or nothing, while a nephew or a friend can face double-digit rates on the same bequest.

Building the taxable estate

The gross estate is the fair market value of everything owned on the date of death, which is what a willing buyer would pay a willing seller, not what was paid for the asset originally. That covers the categories in the form above: real estate, investments, bank balances, vehicles and boats, retirement accounts, life insurance, and everything else, from a business interest to a stamp collection.

Two entries surprise people. Life insurance counts in your estate if you owned the policy, so a $2 million death benefit meant to provide for a family can be the thing that pushes the estate over the line. An irrevocable life insurance trust owning the policy instead keeps the proceeds out. Retirement accounts count too, and they get hit twice: the balance is in the taxable estate, and heirs then pay ordinary income tax as they withdraw it, since the money was never taxed going in. The RMD Calculator and IRA Calculator deal with that second layer.

From the gross estate you subtract debts such as mortgages and credit cards, funeral and administration expenses, claims against the estate, state estate taxes paid, and charitable gifts, which are unlimited. Anything passing to a surviving spouse who is a US citizen is deducted in full under the marital deduction, which is why this calculator asks only about what goes to other heirs. A non-citizen spouse does not get that deduction automatically; the usual fix is a qualified domestic trust.

The unified credit and lifetime gifts

Gift tax and estate tax share one lifetime allowance, which is why the form asks what you have already given away. Every taxable gift you make during life uses up part of the same $15 million, so the exemption left at death is what remains. Give away $2 million and die in 2026 and the estate has $13 million of exemption, not $15 million.

This is the mechanism that stops people from simply handing everything to their children the week before death. It also means large lifetime gifts are not wasted: they lock in today's exemption and, more usefully, move all future growth on those assets outside the estate.

Paperwork follows any gift above the annual exclusion. You file Form 709 for that year, which reports the gift and tracks how much of the lifetime allowance you have spent, and in almost every case no tax is actually paid at the time. Gift tax only becomes payable once the whole exemption is exhausted, which is rare. Keep those returns permanently, because the executor will need them to work out how much exemption is left.

Gifts that never touch the exemption

The annual exclusion lets you give $19,000 to any number of people each year with no gift tax and no effect on your lifetime allowance. A married couple can combine their exclusions and give $38,000 to each recipient. Give three children the full amount every year for ten years and $1.14 million leaves the estate without using a dollar of the exemption.

Several gifts sit outside the system entirely:

• Tuition paid directly to the school and medical bills paid directly to the provider, with no dollar limit. The payment has to go to the institution, not to the student or patient.
• Gifts to a spouse who is a US citizen, without limit.
• Gifts to qualified charities and to political organizations.

A 529 plan has its own trick: you can front-load five years of annual exclusions at once, putting $95,000 in for one beneficiary, or $190,000 from a couple, and elect to spread it across five years for gift tax purposes.

Portability, and the return you file anyway

When the first spouse dies, whatever exemption they did not use can transfer to the survivor. That is portability, and it turns two $15 million allowances into $30 million for a married couple. It is not automatic. The executor has to file Form 706 for the first death and elect it, even when the estate is far below the filing threshold and no tax is owed.

Form 706 is due nine months after death, with a six-month extension available. Families who miss the portability election because the first estate looked too small to bother with can often still fix it: a simplified procedure allows a late election up to five years after death when no return was otherwise required. Missing that window is one of the most expensive administrative mistakes in this area, because the lost exemption can be worth $6 million of tax at the 40% rate.

The step-up in basis, and why gifting can backfire

Inherited assets receive a new cost basis equal to their value at death. This is the single largest tax break in estate planning, and it argues against giving appreciated property away during your lifetime.

Take shares bought for $100,000 that are worth $1 million. Leave them in the estate and your heirs inherit at $1 million, sell the next day, and owe nothing. Gift the same shares while you are alive and the recipient takes your original $100,000 basis, so selling triggers tax on $900,000 of gain, which at 23.8% is $214,200.

The planning rule that falls out of this is straightforward: for an estate below the exemption, keep appreciated assets until death and gift cash instead. Above the exemption, the calculation flips, because 40% estate tax hurts more than 23.8% capital gains tax. Note also that retirement accounts get no step-up, which is what makes them the worst asset to leave to heirs and the best one to leave to charity.

Valuation, and the timing options

Everything is valued at the date of death by default, but the executor can elect an alternate valuation date six months later. That election is only allowed when it reduces both the gross estate and the tax owed, which makes it useful after a market fall and unavailable when values have risen.

Two provisions help families whose wealth is illiquid. Special use valuation lets a farm or a closely held business be valued on its actual use rather than its highest and best use, cutting the taxable figure by a capped amount. And when a closely held business makes up more than 35% of the estate, the tax attributable to it can be paid in instalments over as long as fourteen years, with interest-only payments in the early years, so the family does not have to sell the business to pay the tax on the business.

Trusts, and what each one is for

A trust is an arrangement where a trustee holds assets and distributes them under rules you set. The first fork is when it takes effect. A living trust is created and funded while you are alive; a testamentary trust is written into your will and comes into being at death.

The second fork matters more for tax. A revocable trust can be changed or dissolved at any time, and because you keep control, the assets stay in your taxable estate. It avoids probate and keeps your affairs private, but it saves no estate tax. An irrevocable trust gives up control permanently, and in exchange the assets and their future growth sit outside the estate. Common versions include an irrevocable life insurance trust holding a policy, a spousal lifetime access trust that removes assets while a spouse can still benefit from them, a grantor retained annuity trust that passes appreciation to children at a low gift cost, a qualified personal residence trust for a house, and a charitable remainder trust that pays you an income and leaves the remainder to charity.

Setting up and funding a trust costs more than writing a will, and funding it means actually retitling accounts and deeds, which is the step people skip. An unfunded trust protects nothing.

Probate is a separate problem

Probate and estate tax get confused constantly. Probate is the court process that validates a will and supervises distribution, and its cost is measured in legal, executor, and court fees rather than tax. An estate can owe zero federal tax and still spend months and a meaningful share of its value in probate.

Assets that pass by contract or by title skip it: retirement accounts and life insurance with a named beneficiary, payable-on-death bank accounts, transfer-on-death brokerage registrations, jointly held property with survivorship rights, and anything already in a living trust. Reviewing those beneficiary designations is the cheapest estate planning there is, and the one most often left undone after a divorce or a death in the family. A beneficiary form beats whatever your will says.

Planning when the tax will never apply

With a $15 million exemption, the point of estate planning for most families is not tax. It is control and cost:

• A will names a guardian for minor children. Without one, a court decides who raises them.
• It says how assets for a minor are managed, and until what age, rather than handing everything over at 18 under state default rules.
• It names an executor you trust to handle the accounts, the debts, and the paperwork.
• A durable power of attorney and a health care proxy cover decisions while you are alive but unable to make them, which is the gap a will does nothing about.

Keep a written inventory alongside the documents, including the small things: a piece of jewellery or a painting can matter far more to a family than its market value suggests, and unlisted digital accounts are a common headache for executors. For the tax side of the rest of the plan, the Retirement Calculator, 401(k) Calculator, and Tax Calculator handle the pieces that arrive before this one ever applies.

Reading the table and the charts

The exemption table lists every year since 2001, and it explains why estate planning advice ages badly. The threshold ran at $675,000 in 2001 with a 55% top rate, disappeared entirely in 2010 when the tax was briefly repealed, and reached $15 million in 2026, while the top rate settled at 40% from 2013. A plan written when the exemption was $1 million can be badly wrong today, in both directions.

The donut splits the gross estate into its asset categories, which is usually the fastest way to spot a concentration problem, such as a business or a single property carrying most of the value with no liquid assets to pay the bill. The area chart plots the exemption year by year, stepped, so the jumps in 2011, 2018, and 2026 are visible as the policy changes they were. Both update as you edit the figures above.