Estate Tax Calculator
Calculate your potential federal estate tax liability. This calculator estimates the federal estate tax due based on your assets, deductions, and lifetime gifted amount. Please note that many states also impose their own estate taxes, but they tend to be less than federal estate taxes.
Estate Tax Calculator
Modify the values and click the Calculate button to use
What is Estate Tax?
The federal estate tax is a tax on the transfer of property at death. It's calculated by adding up the fair market value of everything you own or have certain interests in at the date of death, including cash, real estate, stocks, and other assets.
Only estates exceeding the exemption amount are subject to the federal estate tax. The current exemption is quite high, meaning the federal estate tax affects only a small percentage of estates in the United States.
Estate Tax Exemptions and Rates
The federal estate tax exemption is the amount that can be passed to heirs without triggering estate tax. As of 2024, the exemption is $13.61 million per individual, or $27.22 million for married couples who properly structure their estates.
The estate tax uses a progressive rate structure, with rates beginning at 18% and rising to 40% for the portion of the taxable estate exceeding the exemption amount.
| Year | Lifetime Exemption | Tax Rates |
|---|---|---|
| 2022 | $12.06 million | 40% |
| 2023 | $12.92 million | 40% |
| 2024 | $13.61 million | 40% |
| 2025 | $13.99 million (est.) | 40% |
Estate Tax Deductions
Several items can be deducted from your gross estate to determine the taxable estate:
Unlimited Marital Deduction
Assets left to a surviving spouse who is a U.S. citizen qualify for the unlimited marital deduction, meaning they pass tax-free.
Charitable Deduction
Assets left to qualified charitable organizations are deductible from the gross estate and not subject to estate tax.
Debts and Expenses
Outstanding debts, funeral expenses, estate administration costs, and certain other expenses are deductible.
Estate Tax Planning Strategies
While the current exemption is high, proper planning can help reduce potential estate tax liability:
- Make annual tax-free gifts below the annual exclusion amount ($18,000 in 2024).
- Consider using trusts like irrevocable life insurance trusts (ILITs) to exclude life insurance proceeds from your estate.
- Explore charitable giving strategies that can provide income during life while reducing estate tax.
- For married couples, ensure proper titling of assets and consider using both spouses' exemptions.
- Consult with an estate planning attorney or tax professional for personalized strategies.
State Estate and Inheritance Taxes
In addition to federal estate tax, some states impose their own estate or inheritance taxes. These taxes often have lower exemption thresholds than the federal estate tax.
Currently, about a dozen states and the District of Columbia have estate taxes, while a few states have inheritance taxes. Check with your state's tax agency for specific information.
How to Use Our Estate Tax Calculator
- Enter all your current assets, including real estate, investments, bank accounts, and other property.
- Input your deductible expenses, such as debts, funeral costs, and charitable bequests.
- Enter any lifetime taxable gifts you've made beyond the annual exclusion.
- Click 'Calculate' to determine your estimated federal estate tax liability.
This calculator provides a simplified estimate of potential federal estate tax. For comprehensive estate planning, consult with qualified professionals.