Estate Tax Calculator
Estimate US federal estate tax from an estate's value, using the current exclusion amount and graduated rate schedule.
How to use this calculator
- 1Enter the estate's total value.
- 2If a spouse died first and elected portability, turn that on to add their unused exclusion.
How the calculation works
Taxable estate = Gross estate − Exclusion. Tax = graduated rates (18%–40%) applied to the taxable estate- Exclusion
- The 2026 basic exclusion amount, doubled for a married couple using portability
- Graduated rates
- A bracket schedule from 18% to 40% — the 40% top rate applies to all taxable value above $1,000,000
The bracket schedule itself has stayed fixed since 2013 — only the exclusion amount is adjusted for inflation each year, which is why estate tax exposure has shrunk dramatically for most families since the exclusion has more than doubled over the past decade.
Because the brackets below $1,000,000 of taxable value are so narrow, the effective rate on any taxable estate above roughly $1.2–1.3 million is very close to the flat 40% top rate.
Worked example
$20,000,000 estate, single, no prior gifts
- 1.Taxable estate: $20,000,000 − $15,000,000 = $5,000,000.
- 2.Tax on the first $1,000,000 of that (per the bracket schedule) is $345,800.
- 3.The remaining $4,000,000 is taxed at the flat 40% top rate: $1,600,000.
- 4.Total: $345,800 + $1,600,000 = $1,945,800.
Result: $1,945,800
What the estate tax actually taxes
The federal estate tax is charged on the transfer of a person’s property at death, not on income — it sits alongside, and is calculated completely separately from, the income tax the estate or its heirs might otherwise owe. It applies to the total value of everything owned at death: real estate, investments, business interests, life insurance proceeds payable to the estate, and more, before anything passes to heirs.
Despite the attention it gets, it is one of the narrowest federal taxes by reach — a large exclusion amount, adjusted for inflation, means only a small share of estates in a given year owe anything at all.
How the exclusion and rates work together
Every estate starts with an exclusion amount that passes completely tax-free, regardless of size. Only the value above that exclusion is taxed, and it is taxed at graduated rates that rise with the amount, similar in structure to the individual income tax brackets, up to a flat top rate that applies to the largest taxable estates. A married couple can generally combine both spouses’ exclusions through an election called portability, effectively doubling the amount that can pass tax-free between them and their heirs.
Lifetime gifts factor in too: taxable gifts made during life count against the same lifetime exclusion used at death, so a person who has already used part of it through large gifts has correspondingly less left to shelter the estate.
Strategies used to reduce exposure
Because the tax only applies above a threshold, most estate planning aimed at it focuses on keeping the taxable estate below that line, or structuring the transfer so it is not part of it at all.
- Lifetime gifting — moving assets to heirs while alive, within annual and lifetime limits that keep gifts from being taxed immediately, gradually shrinking the estate that will eventually be measured against the exclusion.
- The marital deduction — transfers to a surviving spouse are generally unlimited and tax-free, which is why estate tax exposure for a married couple usually only becomes relevant when the second spouse dies.
- Charitable giving — bequests to qualifying charities are deducted from the taxable estate entirely, which is why charitable planning is a common tool for larger estates.
- Irrevocable trusts — moving assets out of a person’s legal ownership, and therefore out of their taxable estate, while still directing how and when heirs eventually receive them.
A tax with a long, shifting history
A federal tax on estates dates back to the Revenue Act of 1916, introduced partly to fund military preparedness ahead of the First World War and partly out of a broader early-20th-century push to tax concentrated wealth. Unlike most of the tax code, its exclusion amount and top rate have swung dramatically over the decades depending on the political and fiscal priorities of the time, with the exclusion in particular rising substantially since the early 2000s.
That volatility very nearly played out again at the end of 2025: the exclusion had been temporarily doubled by the 2017 Tax Cuts and Jobs Act, a provision written to expire on January 1, 2026 and roughly halve the exclusion back toward its pre-2018 level. The One Big Beautiful Bill Act, signed July 4, 2025, cancelled that scheduled drop and set the exclusion at $15 million per person for 2026 instead, indexed to inflation from 2027 onward — a reminder that even a threshold described as "permanent" is a matter of current law, not a fixed constant, and worth checking again whenever a major tax bill passes.
What this assumes, and where it stops
Assumptions
- The full exclusion is available and unused by prior gifts, unless entered otherwise.
- No deductions (charitable bequests, marital deduction for a surviving spouse, administrative expenses) are modelled — these would reduce the taxable estate further.
Limitations
- US federal tax only — does not include state estate or inheritance taxes, which apply in about a dozen states, often at much lower exclusion thresholds.
- Does not model the marital deduction (unlimited transfers to a surviving spouse are generally tax-free), charitable deductions, or valuation discounts, all of which commonly reduce real estate tax bills.
- Estate tax law has changed significantly over the past two decades and the current high exclusion amount is legislated to potentially change in the future — always check current law near the date it matters.
Common questions
Do most people need to worry about estate tax?
No — with a multi-million-dollar exclusion per person (and double that for a married couple using portability), the large majority of estates owe no federal estate tax at all. It becomes a real planning consideration mainly for high-net-worth individuals and families, though state-level estate or inheritance taxes can apply at much lower thresholds in some states.
What is portability?
When one spouse dies without using their full exclusion, the surviving spouse can elect to add the unused amount to their own — effectively allowing a married couple to shield close to double the exclusion from federal estate tax. It is not automatic; it requires filing an estate tax return for the first spouse to die, even if no tax is owed, specifically to make the election.
Sources
- IRS releases tax inflation adjustments for tax year 2026, including amendments from the One, Big, Beautiful Bill — US Internal Revenue Service
Formula and content last reviewed on .
Results are estimates for information only, not professional advice.
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