Estate Tax Calculator
Estate, exemption & rate
Your result will appear here
Fill in the fields and this updates as you type.
Know what this estimate is based on
- Jurisdiction
- United States — federal income and payroll tax, unless the calculator names a state or local levy
- Rules and time period
- Tax years supported by the selected calculator. Brackets, standard deductions and wage bases are re-set every year, and state and local rules are not modeled unless the page says so.
- Scope and limitations
- Educational estimate only, not a tax return, a filing determination or a withholding instruction. Confirm current law and your own facts with the IRS, your state authority or a qualified tax professional before filing or changing a W-4.
- Source links checked
- Sep 19, 2026
Built and regression-tested by Smart Tools Lab. It has not been individually reviewed by a licensed financial, tax, or legal professional.
How to use
- 01
Enter the estate value — everything owned at death at fair market value, not what was paid for it. The gross estate is wider than most people expect: it includes retirement accounts, the death benefit of life insurance you owned, and your share of jointly held property.
- 02
Set the exemption. The federal basic exclusion is $15 million per person for 2026 ($13.99 million for 2025), indexed thereafter. If a spouse died earlier and portability was elected, the surviving spouse's exemption can be nearly double this.
- 03
Set the estate tax rate. The top federal rate is 40%, which is the figure to use for any estate large enough to be taxable at all.
- 04
Open Advanced and enter deductions — debts and mortgages, funeral and administration expenses, and anything passing to a spouse or to charity. These come off before the exemption applies, so they are worth more than they look.
- 05
Still in Advanced, add your state's estate tax rate and its own threshold if the estate is in one of the states that levy their own. State thresholds are often far below the federal exemption, so this is where many estates meet a bill for the first time. Leave the state threshold blank and the calculator uses the federal one, which produces no state tax.
- 06
Read the taxable estate, the tax due and what reaches the heirs. The last line is the one to act on — it is the figure that planning changes.
Formula
Federal estate tax narrows the estate twice before taxing what is left: Net estate = max(0, gross estate − deductions) Taxable estate = max(0, net estate − exemption) Federal tax = taxable estate × rate State tax = max(0, net estate − state exemption) × state rate Passed to heirs = gross estate − deductions − total tax Deductions come off first, and they are broad: debts, mortgages, funeral and administration costs, and — without limit — anything passing to a surviving spouse or to charity. Only then does the exemption apply. The practical consequence is that the marital deduction can drop a very large estate to zero tax at the first death while leaving the whole problem to the second. That is what portability exists to solve, and why the exemption figure in this calculator can legitimately be one exemption or two.
Example
An estate of $20 million, with $1 million of debts and administration costs and no charitable or marital transfers. The net estate is $19 million. Subtract the $15 million exemption and $4 million is taxable. At 40% the federal tax is $1,600,000, and the heirs receive $17,400,000. Now suppose the deceased was a widow whose husband died earlier and whose executor filed Form 706 to elect portability. Her exemption is $30 million, the taxable estate is $0, and the entire $19 million reaches the heirs. The only difference between the two outcomes is a return filed at the first death, when no tax was owed and filing was optional. Add a state with a $2 million threshold and a 16% top rate and the picture changes again. Enter both in Advanced: on a $19 million net estate that is $17 million over the state threshold, a state bill of $2,720,000 sits alongside the federal one — and on an estate below the federal exemption the state bill can be the only tax due.
Definitions
- Gross estate
- Everything owned or controlled at death at fair market value — real property, investments, business interests, retirement accounts, and life insurance you owned on your own life.
- Net estate
- The gross estate after debts, mortgages, funeral and administration expenses, and marital or charitable transfers.
- Taxable estate
- The net estate after the exemption. Only this figure is multiplied by the rate.
- Basic exclusion amount
- The federal exemption — $15 million per person for 2026, up from $13.99 million for 2025 under P.L. 119-21, and indexed thereafter. Unified with the lifetime gift exemption, so lifetime gifts reduce it.
- Portability (DSUE)
- The Deceased Spousal Unused Exclusion. A surviving spouse may add the unused portion of the first spouse's exemption, but only if Form 706 was filed at the first death — even when no tax was due.
- Marital deduction
- An unlimited deduction for property passing to a surviving United States citizen spouse. It defers rather than removes the tax, which is why the second death is where planning matters.
- Charitable deduction
- An unlimited deduction for amounts passing to qualifying charities.
- Form 706
- The United States Estate (and Generation-Skipping Transfer) Tax Return, due nine months after death with a six-month extension available. Also the return that elects portability.
- Step-up in basis
- Assets in the estate are revalued to their date-of-death value for the heirs, erasing the capital gain accumulated during the deceased's life. It applies whether or not estate tax is owed.
- Estate tax vs inheritance tax
- An estate tax is charged to the estate before distribution; an inheritance tax is charged to each recipient and often varies with how closely related they were. A handful of states levy one or the other; one — Maryland — levies both.
- Applicable credit amount
- The credit that delivers the exemption. It is applied against the computed tax rather than subtracted from the estate, which is why the exemption is shared with lifetime gifts.
- Alternate valuation date
- An election to value the estate six months after death rather than on the date of death, available when it lowers both the gross estate and the tax.
- Generation-skipping transfer (GST) tax
- A separate 40% tax on transfers to grandchildren or others two or more generations below, with its own exemption. Not modeled here.
- Illiquidity risk
- The problem of a taxable estate held mostly in property or a business: the tax is due in nine months in cash, which can force a sale. It is the usual reason for life insurance held outside the estate.
Good to know
What the estate tax actually reaches, and how few estates it touches
The federal estate tax is charged on the transfer of everything you own at death, above an exemption that for 2026 stands at $15 million per person, raised from $13.99 million by P.L. 119-21. Because a married couple who plan correctly can shelter close to twice that, the tax reaches well under one percent of deaths in a typical year. That statistic misleads in two directions. It makes most people assume the estate tax is irrelevant to them, and it makes people near the threshold assume they are safe when they are not — because the gross estate is much wider than the assets people count. The gross estate includes everything owned or controlled at death, at fair market value. Not what you paid, and not what it appeared to be worth when you last looked. It includes your home and any other property, investments, cash, business interests, vehicles and personal property. It includes retirement accounts in full, even though the beneficiary will owe income tax on every dollar drawn out. It includes the death benefit of any life insurance policy you owned — a figure that can add a million dollars to an estate the deceased never thought of as wealthy. It includes your share of jointly held property, and in some circumstances the whole of it. It also reaches back. Gifts made within three years of death can be pulled back into the estate in certain cases, and any lifetime gifts above the annual exclusions have already reduced the exemption available. The result is that people are frequently surprised by their own gross estate. A paid-off house, a healthy retirement account, a business with real value and a term life policy can combine into a figure that clears state thresholds comfortably and approaches federal ones — without the person ever having considered themselves subject to an estate tax. There is a further reason the gross estate surprises people: it is measured at death, not at the point when the plan was made. A business valued at two million when the will was drafted may be worth eight by the time it matters, and a plan that assumed the estate sat safely below the threshold no longer does. Estates grow, exemptions move with legislation rather than with your assets, and the gap between the two changes in both directions. A plan reviewed once a decade is a plan built on figures that have almost certainly stopped being true.
Deductions come first, and the marital deduction changes everything
Before the exemption applies, the estate is reduced by its deductions — and they are broad enough that the order matters a great deal. Debts and mortgages come off. Funeral expenses come off. The costs of administering the estate — executor fees, legal fees, appraisals — come off. Anything passing to a qualifying charity comes off without limit. And anything passing to a surviving spouse who is a United States citizen comes off without limit, through the marital deduction. This is the most powerful provision in the whole structure and the most commonly misunderstood. The marital deduction means an estate of any size can pass to a surviving spouse with zero federal estate tax. A $50 million estate left entirely to a spouse produces no tax at the first death. This feels like the problem is solved, and it is not — it is deferred. The assets are now in the survivor's estate, and at the second death there is no spouse to deduct to. Worse, if the first estate used none of its own exemption because the marital deduction had already reduced the taxable estate to zero, that exemption can simply evaporate. The family sheltered nothing at the first death and has only one exemption left for a combined estate. This is the specific failure that portability exists to prevent, and it is why the most consequential estate tax decision a family makes is often taken at a moment when no tax is owed and no return appears to be required. The deduction ordering also creates an opportunity that is easy to overlook. Because charitable transfers are deducted without limit and before the exemption applies, a bequest to charity reduces the taxable estate dollar for dollar at the top rate. For an estate already above the exemption, forty cents of every charitable dollar comes from tax that would otherwise have been paid. That does not make giving free, but it changes the arithmetic considerably — and it is why charitable bequests cluster among estates large enough to be taxable rather than being spread evenly across all wills.
Portability: the election that is lost by not filing
Portability lets a surviving spouse add the unused portion of the first spouse's exemption to their own — the Deceased Spousal Unused Exclusion, or DSUE. On 2026 figures it can take a survivor's shelter from $15 million to $30 million. It is not automatic. It must be elected by filing Form 706 for the first spouse's estate, and Form 706 is the estate tax return — a return that, in exactly the situation where portability matters most, has no tax to report. Families routinely skip it. The estate passed entirely to the spouse, the marital deduction made the tax zero, the estate is well under the exemption, and nobody sees a reason to prepare a lengthy return with no payment attached. The consequence surfaces years later. The survivor dies with a combined estate of $20 million and a single $15 million exemption, and $5 million becomes taxable at 40% — a $2 million bill created entirely by a return that was not filed. The relief provisions have generally been generous for estates that were not otherwise required to file, allowing a late election within an extended window, but relying on that is a poor plan. The window has changed more than once, and it is a remedy, not an entitlement. The practical rule is simple and worth stating plainly: when a married person dies with any meaningful wealth, ask specifically whether Form 706 should be filed to elect portability, even when — especially when — no tax is due. It is one of the few estate planning decisions where the cost of acting is a few thousand dollars of preparation and the cost of not acting can be seven figures. One limitation: the DSUE is fixed at the amount unused at the first death and does not grow with inflation, while the survivor's own exemption does. It is worth being precise about what portability does not do. It transfers the unused exemption, but it does not transfer the generation-skipping transfer exemption, which is not portable at all and is lost if unused at the first death. Nor does the ported amount grow with inflation, while the survivor's own exemption does. For families whose planning involves grandchildren, or whose estates are expected to appreciate substantially after the first death, relying on portability alone is weaker than it looks, and a credit shelter trust may still do work that portability cannot.
The step-up in basis, and why it often matters more than the estate tax
For the vast majority of families — the ones nowhere near the exemption — the important thing that happens at death is not a tax but a basis reset. Assets included in the estate are revalued for income tax purposes to their fair market value at the date of death. The heirs inherit that value as their cost basis. Every dollar of capital gain accumulated during the deceased's lifetime disappears. A rental property bought for $80,000 forty years ago and worth $600,000 at death carries a $520,000 built-in gain during life. Sell it while alive and that gain is taxable. Leave it in the estate and the heirs' basis becomes $600,000 — if they sell the following month, there is no capital gains tax at all. This applies whether or not any estate tax is owed, which makes it the most valuable tax provision most families will ever encounter, and one that operates silently without anyone electing anything. It also explains why the standard advice to reduce your estate by gifting can be exactly wrong. Gifting an appreciated asset transfers your basis with it and forfeits the step-up. For someone whose estate will never be taxable, that trades a tax they would never have paid for one their children certainly will. There are two important qualifications. The step-up applies to assets in the estate, so anything moved out during life — including into certain irrevocable trusts — may not get it. And it does not apply to income in respect of a decedent: traditional retirement accounts carry their full income tax liability to the beneficiary, with no step-up and, for most non-spouse beneficiaries, a requirement to empty the account within ten years. Retirement accounts are consequently among the most heavily taxed assets to leave behind, and among the best to spend first or leave to charity. The step-up has one more consequence worth planning around: it applies asset by asset. An estate holding both a highly appreciated stock position and a recently purchased one gets a large benefit on the first and none on the second. Where assets will be sold soon after death, holding the most appreciated ones until then and spending or gifting the low-gain ones first captures more of the benefit. It is a small optimisation on any single asset and a substantial one across a portfolio built over decades.
State estate and inheritance taxes, where most bills actually arise
The federal exemption is high enough that most estate tax bills in the United States are not federal at all. Around a dozen states plus the District of Columbia levy their own estate tax, and a handful levy an inheritance tax instead — with one state, Maryland, levying both. State thresholds are dramatically lower than the federal one, frequently between one and seven million dollars, and some are not indexed for inflation at all. A family that has correctly concluded it will never owe federal estate tax can still face a state bill running into hundreds of thousands of dollars. The two taxes work differently and it is worth keeping the distinction clear. A state *estate* tax is charged on the estate before distribution, like the federal one. A state *inheritance* tax is charged to each beneficiary on their share, and the rate typically depends on the relationship — a spouse or child may pay nothing or very little, while a sibling, niece or unrelated friend pays a real rate on the same amount. Leaving money to a friend rather than a child can produce a materially different tax outcome in an inheritance tax state. Which state applies is a question of domicile, and domicile is not simply where you spent the most nights. It turns on where you intended your permanent home to be, evidenced by voter registration, driving license, where you file, where your professional advisers are, and where your significant possessions sit. States with estate taxes have every incentive to argue that a departing resident never truly left, and residency disputes after a death are genuinely common. Property is different again: real estate is generally taxable by the state where it sits, regardless of where you lived. A vacation home in an estate tax state can create a filing obligation there for someone who was never a resident. Two practical points follow for anyone with property or connections in more than one state. First, a state estate tax generally applies to real property located there regardless of your residence, so a holiday home can create a filing obligation in a state you never lived in. Second, states differ on whether they recognize portability at all — several do not, meaning a couple relying on the federal election may still face a state bill at the second death. Multi-state estates need advice in each relevant state, not only where the person lived.
Liquidity: the nine-month problem
Federal estate tax is due nine months after death, in cash. An extension of six months is available for filing the return; it does not extend the time to pay. For an estate held in marketable securities this is an administrative task. For an estate held in a farm, a family business, a portfolio of rental property or a single large house, it is the central problem — because the value is real, the tax is calculated on it, and none of it is spendable in nine months without selling something. The pressure this creates is exactly wrong for the family. Assets must be sold on a deadline, in whatever market exists at the time, often to buyers who know the deadline. The business that was meant to pass to the next generation is sold to fund the tax on itself. There are relief provisions. Certain estates consisting largely of a closely held business interest may pay in installments over an extended period at favorable interest, and there are provisions for special-use valuation of farm and business real property. Both come with strict qualification tests and continuing obligations that can claw the benefit back if circumstances change. The more common solution is insurance held outside the estate. A policy owned by an irrevocable trust, or by the beneficiaries themselves, pays out on death without being included in the gross estate, and provides cash exactly when the tax is due. Owned personally, the same policy adds its full death benefit to the estate and increases the very tax it was bought to pay — one of the most consequential ownership details in estate planning, and one that costs nothing to get right at the outset. The question to ask of any estate approaching the threshold is simply: on the day this is due, where does the cash come from? If the answer is a forced sale, that is the problem to solve first. The installment relief is worth understanding before it is needed, because qualification is decided by the composition of the estate rather than by hardship. It generally requires the closely held business interest to exceed a substantial share of the adjusted gross estate, and it imposes continuing conditions — dispose of too much of the business, or miss a payment, and the remaining balance can be accelerated. Families intending to rely on it should confirm they qualify while the person is alive and the ownership structure can still be adjusted, not after death when it is fixed.
How planning actually reduces the number
Estate planning is less about clever structures than about a small number of levers applied early. Using the annual gift exclusion consistently removes money from the estate without touching the exemption at all. A couple with three children and their spouses can move well over $200,000 a year using exclusions alone, and repeated over a decade the effect is substantial. Giving assets expected to appreciate removes not only their present value but all future growth. Gifting a business interest before a sale or an expansion uses exemption at today's value and moves tomorrow's outside the estate entirely. Charitable gifts are deductible without limit, and structures like charitable remainder trusts can combine an income stream during life with a deduction and a removal from the estate. Irrevocable trusts move assets out of the estate while allowing some control over how they are used, at the cost of flexibility and often of the step-up in basis. The trade-off between estate tax saving and basis step-up is the central technical question in most plans, and it moves with the size of the estate and the exemption in force. Holding life insurance outside the estate is usually the highest-value single change for a family with an illiquid estate. And for married couples, filing Form 706 to elect portability is the cheapest and most reliably valuable action available. All of these depend on the exemption in force, and that has moved sharply in both directions within living memory. A plan built on today's figure should be revisited when the law changes, and any structure that becomes unnecessary if the exemption rises should be designed so it can be unwound. Timing is the lever that is easiest to underuse. Almost every technique described here works better the earlier it is applied, because the value being moved is smaller and the growth being removed is larger. Waiting until an estate is obviously taxable means transferring assets at their highest value, using the most exemption for the least effect, and doing it under time pressure. The families who end up paying least are rarely the ones with the cleverest structures; they are the ones who started while the numbers were small enough that the decisions felt unimportant.
What this calculator does not model
This tool applies deductions, then an exemption, then a flat rate — the correct shape, and enough to size the problem. Several things sit outside it. The federal rate schedule is graduated, and this calculator uses a single rate. Since the exemption absorbs the lower brackets entirely, the 40% top rate is the right figure for any taxable estate, but the model is a simplification. Prior taxable gifts are not modeled. Lifetime gifts above the annual exclusions have already reduced your exemption, and the return computes the tax cumulatively. Enter a reduced exemption yourself if you have made significant reportable gifts. Portability is not modeled as a mechanism — you can capture it by entering the combined figure, but the calculator will not tell you whether the election was made. That is a question for the first spouse's return. The generation-skipping transfer tax is not included, and for estates passing to grandchildren it can add a separate 40% layer with its own exemption. State rules are represented only as a single additional rate. Real state calculations have their own thresholds, their own deductions, their own graduated schedules, and in inheritance tax states a rate that varies by beneficiary. The figure this produces is indicative only. Valuation is assumed. In practice, valuing a closely held business, fractional interests in real property, or assets lacking a market is the largest and most contested part of a real estate tax return, and discounts for lack of control and marketability can change the taxable figure substantially. Use this to answer the first question — is this estate anywhere near a threshold, federal or state, and what would the bill look like? If the answer is anything other than a clear no, the next step is an estate attorney in the relevant state. A closing note on proportion. For the great majority of families the federal estate tax will never apply, and the effort is better spent elsewhere: a valid and current will, beneficiary designations that match it, a durable power of attorney, and clear records of what exists and where. Those documents affect every estate. The estate tax affects fewer than one in a hundred. Getting the ordinary things right is worth more than optimising a tax you were never going to pay — and if you are in the minority who will pay it, the ordinary things still come first.
Frequently asked questions
How many estates actually pay federal estate tax?
Very few — well under one percent of deaths in a typical year. With a $15 million exemption per person for 2026, and effectively double that for a married couple who elected portability, the federal tax reaches only substantial estates. State-level estate and inheritance taxes catch far more, because their thresholds are much lower.
What is portability and why does it matter so much?
It lets a surviving spouse use whatever exemption the first spouse did not. Without it, an estate that passes everything to the spouse wastes the first exemption entirely, because the marital deduction already made that transfer tax-free. Portability can be the difference between a $0 bill and a seven-figure one — and it is claimed by filing Form 706 at the first death, when nothing is owed and filing feels unnecessary.
Is life insurance part of my estate?
If you owned the policy, yes — the full death benefit is in your gross estate, even though it never passed through your hands. This catches people out routinely. Holding the policy in an irrevocable life insurance trust, or having another person own it, keeps the proceeds outside the estate while still providing the liquidity to pay the tax.
Do my heirs pay income tax on what they inherit?
Generally not on the inheritance itself. But inherited traditional retirement accounts carry income tax to the beneficiary as they draw them down, and most non-spouse beneficiaries must now empty an inherited IRA within ten years. That makes retirement accounts among the most heavily taxed assets to leave behind.
What is the step-up in basis worth?
Often more than the estate tax itself for a smaller estate. Assets are revalued to their date-of-death value, so decades of capital gain disappear for the heirs. A stock bought at $50,000 and worth $500,000 at death passes with a $500,000 basis — if the heirs sell immediately, there is no capital gains tax at all.
Should I give assets away during my life to reduce my estate?
Sometimes, but it is not free. Gifted property carries your original cost basis to the recipient, so you trade away the step-up. For a highly appreciated asset, keeping it until death is frequently better even though it stays in the estate. Gifting works best with assets you expect to appreciate sharply after the gift, since that growth happens outside your estate.