Estate Tax Calculator
Model the federal and state estate tax together — and see why the combined marginal rate is 49.60%, not the 56.00% you get by adding the two headline rates.
Estate Tax Calculator
Results recalculate instantly on every keystroke. Nothing you type is transmitted.
What this result does not account for
- State estate tax is modelled as a flat rate above an exemption; most states use graduated bands topping near 16%.
- The unlimited marital deduction, GST tax and valuation discounts for closely held interests are not modelled.
- Figures are 2026 and the federal exemption is indexed annually from 2027.
In short: A $22,100,000 net estate in a state with a $2,000,000 exemption pays $3,216,000 in state tax and $1,553,600 federally — $4,769,600 in total, or 21.58%. State estate tax is deductible against the federal estate, so the true combined marginal rate is 49.60%, not 56.00%.
Formula
s is the state estate tax rate and Shelter is the federal exemption remaining after lifetime gifts, plus any deceased spousal unused exclusion. The state tax appears inside the federal calculation because IRC 2058 makes it deductible.
Worked Example
- Reduce the gross estate. $24,000,000 less $900,000 of debts and administration costs and $1,000,000 of charitable bequests leaves a $22,100,000 net estate.
- Apply the state tax first. $22,100,000 less a $2,000,000 state exemption is $20,100,000, taxed at 16% for $3,216,000.
- Deduct that state tax federally. IRC 2058 allows the state estate tax as a deduction. The federal taxable estate is $22,100,000 less $3,216,000 less the $15,000,000 exemption, or $3,884,000.
- Apply the 40% federal rate. $3,884,000 × 40% = $1,553,600, bringing the total to $4,769,600 or 21.58% of the net estate.
- Read the true marginal rate. An extra dollar costs 16 cents of state tax, and the federal 40% applies to the 84 cents remaining. 40% + 16% × 60% = 49.60%, not 56.00%.
The estate is large enough to clear the $15,000,000 federal exemption, so both taxes are live. Note the ordering: the state tax is computed first because it reduces the federal taxable estate. Adding 40% and 16% overstates the combined burden by 6.40 percentage points.
Strengths & Limits Of This Model
Where this engine is strong
- Applies the IRC 2058 state-tax deduction correctly, which most calculators miss entirely.
- Separates the state and federal layers so you can see which one actually binds.
- Models portability, the single largest lever available to a married couple.
Where it stops
- Not a substitute for counsel at this scale — it sizes exposure, it does not plan around it.
- Cannot model trust structures, which is where most real estate planning happens.
- State rules vary far more than a single rate and exemption can capture.
Practical Use Cases
Sizing a liquidity need
Estate tax is due within nine months, in cash. A $4,769,600 bill against illiquid assets is the classic forced-sale scenario that life insurance is bought to prevent.
Testing whether portability is worth electing
Filing a return to port a deceased spouse's unused exclusion doubles the shelter to $30,000,000 and eliminates the federal tax entirely here.
Deciding where to retire
Twelve states and the District of Columbia levy an estate tax, most with exemptions far below the federal figure. A $6,000,000 estate owes nothing federally but $640,000 in a $2,000,000-exemption state.
Valuing a charitable bequest
Charitable transfers leave the taxable estate entirely — model the trade-off alongside the Net Worth Calculator.
Methodology & Editorial Standards
Figures are 2026. The federal exemption is $15,000,000 per person and the top rate 40%, both made permanent by the One Big Beautiful Bill Act of July 2025 — the widely anticipated reduction to roughly $7,000,000 did not occur. The engine applies the state estate tax as a deduction against the federal taxable estate under IRC 2058, which is why the combined marginal rate is 49.60% rather than the sum of the two rates. State estate tax is modelled as a flat rate above an exemption; most states in fact use graduated brackets topping out near 16%, so this is a close approximation rather than a filing figure. The unlimited marital deduction, generation-skipping transfer tax, valuation discounts for closely held interests, and the special-use valuation of farmland are outside scope. Estate tax planning at this scale requires counsel; this tool sizes the exposure, it does not replace advice. The engine implements the standard published formula for this calculation. Inputs are validated for domain and sign before evaluation, and any undefined case returns an em-dash rather than a spurious value.
Computation runs in IEEE-754 double precision at full internal precision; rounding to two decimal places occurs strictly at the display layer, so no cumulative drift enters the result. All monetary outputs use accounting presentation — grouped thousands, two decimals, negatives in parentheses — so figures can be transcribed directly into a model or working paper. Division-by-zero and out-of-domain inputs return an em-dash rather than a misleading number.
This engine was reconciled against an independent reference implementation and hand-verified for the worked example above before release. Our full five-stage review process is published on the About Us page.
Disclaimer. This calculator is provided for informational and modelling purposes only and does not constitute financial, tax, legal, medical, or engineering advice. Verify all figures with a qualified professional before acting on them.
Estate Tax Calculator — 20 Expert FAQs
20 analyst-written answers to the questions practitioners actually ask — optimised for voice and answer-engine retrieval.
How much can you inherit without paying federal estate tax?
$15,000,000 per person in 2026, or $30,000,000 for a married couple with portability elected. The One Big Beautiful Bill Act made this permanent and indexed it to inflation from 2027.
Did the estate tax exemption drop in 2026?
No. It was scheduled to halve to roughly $7,000,000 when the TCJA provisions expired, but the One Big Beautiful Bill Act of July 2025 removed the sunset entirely and raised the figure to $15,000,000.
Is the combined estate tax rate 40% plus my state rate?
No, and this is the most common error. State estate tax is deductible against the federal taxable estate, so 40% and 16% combine to 49.60%, not 56.00%.
Who pays the estate tax, the estate or the heirs?
The estate pays, before assets are distributed. That distinguishes it from inheritance tax, which the individual beneficiary pays on what they personally receive.
What is portability and do I have to elect it?
Portability lets a surviving spouse add the deceased spouse's unused exclusion to their own. It is not automatic — the executor must file Form 706 within nine months of death, plus extensions, even when no tax is due.
Which states have their own estate tax?
Twelve states and the District of Columbia. Exemptions range from about $1,000,000 in Oregon to the full federal figure in Connecticut, so a modest estate can owe state tax and no federal tax.
When is estate tax due?
Nine months after the date of death, in cash. Extensions to file are readily granted; extensions to pay are not, which is why liquidity planning matters more than the tax itself.
Does the estate tax apply to life insurance?
Yes, if the deceased owned the policy. Proceeds are included in the gross estate at face value, which is why policies intended to pay estate tax are usually held in an irrevocable trust.
How do charitable bequests reduce estate tax?
They leave the taxable estate entirely. The $1,000,000 charitable bequest here removes $1,000,000 from the base and saves 49.60 cents on the dollar at the combined marginal rate.
What is the step-up in basis?
Assets in an estate are revalued to their date-of-death value for income tax purposes, erasing any unrealised capital gain. For estates below the exemption this makes holding until death strictly better than gifting during life.
Is there clawback on gifts made under the old exemption?
No. The anti-clawback regulations protect gifts made when the exemption was higher, and since the exemption is now rising rather than falling the question is largely academic.
Do debts and funeral costs reduce the estate?
Yes. Mortgages, unpaid taxes, funeral expenses and administration costs are all deductible from the gross estate before the exemption applies.
What happens to a surviving spouse's inheritance?
The unlimited marital deduction means transfers to a US citizen spouse are entirely free of estate tax, whatever the amount. The tax question is deferred to the second death.
Is the generation-skipping transfer tax separate?
Yes. The GST tax is an additional 40% on transfers to grandchildren and beyond, with its own $15,000,000 exemption that is not portable between spouses.
Should I gift assets now to reduce my estate?
Only if your estate genuinely exceeds the exemption. Below it, gifting forfeits the step-up in basis and increases your heirs' capital gains tax for no estate tax benefit.
Is this estate tax calculator free to use?
Yes. It is free, requires no account, and has no usage limits. ApexConverter is funded by contextual advertising, never by selling user data.
Is my data sent to a server?
No. The engine runs as Vanilla JavaScript inside your browser under our Zero-Server Client-Side Execution model. Your figures are computed locally and are never transmitted, logged, or stored.
How accurate is this calculator?
It applies the standard closed-form formula in IEEE-754 double precision, rounding only at the display layer. The engine is reconciled against an independent reference implementation before release.
Does it work on mobile?
Yes. The interface is mobile-first with numeric keypad hints and is tested down to a 320-pixel viewport with no horizontal scrolling.
Can I use it offline?
Largely, yes. Because computation is client-side, the page continues to calculate without a network connection once it has loaded.