Federal Estate Tax Calculator: Estimate Your Estate Tax

Estate Tax Calculator Inputs: What Counts in Your Gross Estate

The gross estate is everything you own, or hold certain interests in, on the date of death. The IRS counts real estate, securities, cash, life insurance you own, annuities, retirement accounts, business interests and valuable personal property such as art or jewelry. Each item enters at its fair market value, which is the price a willing buyer would reasonably pay, not what you originally paid. The marriage tax calculator online is free to use with no sign-up, and works on desktop and mobile.

Valuing assets at fair market value

Publicly traded securities are easy: use the closing price on the date of death. A private company, a rental building or a collection needs an appraisal. If the estate's total value is falling, the executor can sometimes choose an alternate valuation date six months later, but only when that choice lowers both the value of the estate and the tax due.

Debts, liabilities and deductions

Your net worth for tax purposes is your assets minus your liabilities. The following reduce the estate before any tax is computed:

• Mortgages and other debts owed at death
• Estate administration expenses such as legal, appraisal and court fees
• Property left to a surviving spouse, which qualifies for the unlimited marital deduction
• Bequests to qualified charities, with no cap on the amount

How the Federal Estate Tax Is Calculated

The federal estate tax is a tax on your right to transfer property at death. It applies only to the slice of your estate that sits above the exemption amount, and that slice is taxed at a top rate of 40%. The calculation follows this order: Try the marginal tax rate calculator to run your own numbers — everything is calculated in your browser and nothing you enter is stored or sent anywhere.

$$\text{Taxable estate} = \text{Gross estate} - \text{Deductions}$$

$$\text{Estate tax} = (\text{Taxable estate} + \text{Adjusted taxable gifts} - \text{Exemption}) \times 40\%$$

Taxable estate and lifetime exemption

Your taxable estate is the gross estate after deductions. Add the adjusted taxable gifts you made during life, meaning lifetime taxable gifts given since 1977 that went above the yearly limit, and you have the total the unified credit is measured against. The lifetime exemption works as a tax credit that wipes out the tax on the first $15,000,000, which is why most families never pay anything.

2026 Estate Tax Exemption and Filing Threshold

The estate tax exemption is indexed to inflation and was raised again for 2026. If the gross estate plus adjusted taxable gifts is above the filing threshold for the year of death, the executor has to file an estate tax return, even if no tax is due.

Estimated Federal Estate Tax on a $23.6 Million Estate: Worked Example

Take a single person who dies in 2026. Their gross estate holds a house and land, a brokerage portfolio, a retirement account, a family business and a life insurance policy they owned. They also gave $1,200,000 in taxable gifts years earlier. The table walks through the estate tax liability step by step.

The tax of $3,336,000 is about 14.1% of the gross estate, far below the 40% headline rate, because the first $15,000,000 is shielded. The beneficiaries would receive roughly $18,804,000 after the tax.

Estate and Gift Tax: Annual Exclusion and Unified Credit

The gift tax and the estate tax share one lifetime allowance. Each year you can give up to $19,000 per person under the annual gift tax exclusion without reporting anything. Larger gifts are reported and reduce the exemption left for your estate, but no gift tax is due until the allowance is gone. Gifts to a spouse, to charity, and tuition or medical bills paid directly to the provider are exempt.

How the unified tax credit shelters your estate

The exemption is delivered through the unified tax credit, a single credit applied first against any gift tax and then against estate tax. Suppose you give away $2,000,000 beyond the yearly limit during life and your estate is otherwise large. Those $2,000,000 are subtracted from the credit available at death, so the estate keeps only $13,000,000 of shelter in 2026. Tracking every reportable gift as you make it prevents an unpleasant surprise later, and it also makes the numbers you type into the calculator far more accurate.

Portability and the estate tax exemption for a surviving spouse

Because of portability, a surviving spouse can claim the unused exemption of the spouse who died first, which is added to the exemption input and lowers the estimated tax. That election is made on a timely filed return, and it can lift a couple's combined shield to $30,000,000 in 2026. Skipping the election can waste millions in protection, so it is worth making even when no tax is due.

A Widow's Estate and Gift Tax Check on a $17.46 Million Estate

A 74-year-old widow wants to know whether to rewrite her plan before year end. She lists what she holds: a home appraised at $4,380,000, a brokerage account at $9,845,000, an IRA at $2,610,000 and art and collectibles at $627,500. That is a gross estate of $17,462,500. Her attorney estimates $180,000 in administration costs, and she has no mortgage.

She also remembers the $1,610,000 she gave her three children years ago, above the yearly limit. She enters the gross estate, the $180,000 deduction and those gifts as adjusted taxable gifts, and keeps the 2026 exemption at $15,000,000.

• Taxable estate: $17,282,500
• Plus adjusted taxable gifts: $18,892,500 total
• Amount over the exemption: $3,892,500
• Tax at 40%: $1,557,000

The total sits $3,892,500 above the $15,000,000 filing threshold, so her executor would have to file Form 706, and the result shows a real bill of $1,557,000. That is about 8.9% of the gross estate.

Two next steps follow from the number. First, she reruns the figures after moving $152,000 into annual-exclusion gifts, $19,000 each to her three children and five grandchildren. The total drops to $18,740,500, the tax to $1,496,200, a saving of $60,800 for one year of gifting. Second, she retrieves her late husband's Form 706, because if he elected portability, his unused exemption could be added to hers and could erase most of the bill. She marks that figure as the one input to change before meeting her attorney.

Death Tax vs. Inheritance Tax: Who Pays and Where

Critics call the estate tax the death tax, but it is paid from the estate before anything is distributed. An inheritance tax is different: the person receiving the inheritance pays it. The federal government has no inheritance tax, although a handful of states do.

State estate tax rules

About a dozen states and the District of Columbia levy a state estate tax, often with an exemption far below the federal one. A state estate could therefore owe tax even when the federal bill is zero, so check your state's rules and the local legal thresholds separately.

Ways to Reduce Estate Tax Liability

Good estate planning begins with an inventory of assets and a review of who inherits what. Several moves cut the tax liability legally:

• Make yearly gifts inside the exclusion to shrink the estate over time
• Leave property to a spouse or to charity, both of which are deductible
• Move assets into an irrevocable trust, so they leave your gross estate and shrink the tax liability
• Spend down wealth or make lifetime gifts, which lowers the gross estate figure
• Name a trusted executor and keep a current will, so the estate tax return is filed on time

Estate planning with trusts

An irrevocable trust removes assets from the gross estate, which lowers the taxable estate and the estate tax liability. The grantor sets the terms and a trustee, acting as a fiduciary, carries them out for the beneficiaries. A living trust also skips probate, while a power of attorney keeps decisions moving if you become unable to act. Review any structure with an attorney before moving assets; the answer will depend on your state, and the revised figures will show the effect.

Common Estate Tax Planning Mistakes to Avoid

Even a well-meaning family can lose a large share of an inheritance through avoidable errors. The most frequent ones are easy to spot once you know what to look for.

• Forgetting that life insurance owned by the insured counts toward the gross estate, so the proceeds can push a modest estate over the line
• Ignoring adjusted taxable gifts, which shrink the exemption available at death, so the estimated tax comes out too low
• Leaving every asset to a spouse and ignoring the exemption of the first spouse to die, which wastes it
• Letting beneficiary designations on retirement plans and policies go stale, even though those accounts count in the gross estate whoever is named
• Waiting until the estate is already above the threshold, when options such as trusts and lifetime gifts have fewer years to work

Revisit your documents after every major life event, such as a marriage, a new child, a business sale or a move to another state. Because the exemption changes with inflation and with new legislation, a plan that worked three years ago may not fit today's numbers, since a changing exemption amount means re-estimating your estate tax liability each year. Your will and the numbers behind it should be refreshed together. Running the calculator again each year, with fresh asset values and an updated list of gifts, is a quick way to see whether your plan still holds up and when it is time to call an attorney.

Filing the Estate Tax Return: Form 706 and the Decedent's Estate

The executor files Form 706 within nine months of the decedent's death, reporting the taxable value of the estate and claiming deductions and any portability election. The IRS then issues a closing letter once the return is accepted. Keep appraisals, account statements and gift records, because the return is only as reliable as the numbers behind it.