Federal Estate Tax Calculator (2026)

Not tax or legal advice. Estate tax planning requires qualified estate counsel. This calculator provides educational estimates for planning conversations only.

Under the One Big Beautiful Bill Act (OBBBA, July 2025), the federal estate tax exemption is $15 million per person in 2026 — permanent, with no sunset.¹ A married couple can shelter up to $30 million (with portability). Above those thresholds, the rate is a flat 40%.² On a $50M estate: $8M owed. On a $100M estate: $34M owed. Use this calculator to estimate your exposure — and see how annual exclusion gifting chips away at it.

What's included in your gross estate

The IRS values virtually every asset you own at death at fair market value — including illiquid assets.² For UHNW families, the largest components are typically:

• Investment accounts. Individual and joint brokerage accounts at full market value. (Assets already in an irrevocable trust where you retained no interest are excluded.)
• Retirement accounts. IRAs, 401(k)s, and Roth IRAs are all included in the gross estate at their full balance — and inherited IRAs face the 10-year drawdown rule under T.D. 10001.
• Business interests. Closely held business at FMV. Minority interests and lack-of-marketability discounts (typically 15–40%) may reduce the reported value — but the IRS scrutinizes aggressive discounts.
• Real estate. Primary residence, vacation homes, and investment property at FMV. The $250K/$500K primary-residence gain exclusion applies only to income tax, not estate tax.
• Life insurance death benefit. Fully included if you own the policy. A $10M term policy = $10M added to your estate. This is why UHNW families use ILITs — moving the policy to an irrevocable trust before death removes the death benefit entirely. (§2035 three-year lookback applies to transfers within 3 years of death.)
• Revocable trust assets. Fully included — revocable trusts avoid probate but not estate tax.
• Retained interests in GRATs. If you die during a GRAT term, the portion of assets needed to fund remaining annuity payments is pulled back into your estate (§2036).

The 40% flat rate — and why it hurts more than it sounds

A 40% estate tax rate applied to a fixed-exemption structure means the effective rate on a large estate can exceed 30% of total gross estate value.

For a $100M estate, married couple with combined $30M exemption: $70M × 40% = $28 million — 28% of the total estate. For a $200M estate: $170M × 40% = $68 million — one-third of everything.

There is also a liquidity problem. Federal estate tax is due in cash within 9 months of death. A family whose wealth is concentrated in illiquid assets — a closely held business, PE fund interests, rental real estate — faces forced liquidation or estate financing unless the plan accounts for this years in advance. Securities-based lending and PPLI with sufficient death benefit are two tools for funding the tax bill without liquidating assets at the worst moment.

Key strategies to reduce the taxable estate

Every strategy below has a different risk profile, asset-type fit, and planning horizon. Most UHNW families use several in combination.

GRATs — transfer appreciation above the §7520 hurdle rate tax-free

A zeroed-out GRAT transfers to heirs any appreciation above the §7520 rate (May 2026: 5.0%) without using any of your $15M exemption. If the GRAT fails — assets don't beat the hurdle — you get everything back at no cost. Ideal for high-growth assets: pre-IPO equity, PE co-investments, private business interests before a sale. Model a GRAT →

SLATs — use your exemption now while keeping indirect access

A Spousal Lifetime Access Trust removes assets from your estate permanently while your spouse retains the ability to receive trust distributions. A $15M SLAT funded today removes the full $15M — plus all future appreciation — from your taxable estate, while your spouse's access preserves a degree of household liquidity. SLAT guide →

IDGT installment sales — transfer large business values efficiently

For closely held businesses worth $10M–$100M, an installment sale to an Intentionally Defective Grantor Trust (IDGT) transfers the entire appreciation above the applicable AFR (May 2026: mid-term 4.08%) with no gift or estate tax on the excess growth. Revenue Ruling 85-13 confirms no gain on the sale itself. IDGT guide →

ILITs — exclude life insurance death benefits from your estate

An Irrevocable Life Insurance Trust owns the policy, collects the death benefit, and distributes to heirs — keeping the full death benefit out of your taxable estate. For a $20M policy, that saves $8M in federal estate tax. ILIT guide →

Dynasty trusts — skip estate tax across multiple generations

Assets in a properly funded generation-skipping trust, sited in a state allowing perpetual trusts (South Dakota, Nevada, Delaware), can grow and be distributed to children and grandchildren without a new estate tax levy at each generation. With $15M GST exemption per person, a married couple can seed a $30M dynasty trust with no GST tax. GST planning guide →

Annual exclusion gifting — simple and consistently underused

In 2026, each person can give $19,000/year to any number of recipients. A married couple gift-splitting can give $38,000/recipient — no gift tax, no Form 709 required. With 4 children and 4 grandchildren: $304,000/year removed from the taxable estate. Over 10 years: $3.04M. At 40%: $1.22M in estate tax avoided with zero planning complexity. 529 superfunding → front-loads $190,000 per couple per beneficiary in year one.

Charitable strategies — redirect the tax bill to causes you control

The IRC §2055 charitable deduction is unlimited. Every dollar to charity reduces the taxable estate by a dollar — so a $5M charitable bequest at a 40% estate tax rate costs your heirs only $3M in foregone inheritance. For families with philanthropic intent, a private foundation or DAF keeps grantmaking control across generations. A Charitable Remainder Trust (CRT) converts appreciated assets into income during your lifetime and a charitable deduction at contribution.

Portability and the married-couple advantage

Portability lets a surviving spouse inherit the deceased spouse's unused exemption — called the DSUE (Deceased Spouse's Unused Exclusion). To claim it, the executor must file Form 706 within 5 years of death, even if no tax is owed.⁴ A surviving spouse with their own $15M exemption plus a $15M DSUE can shelter $30M — identical to a couple with both spouses living.

Critical caveat: GST exemption is not portable. Each person has a separate $15M GST exemption that cannot pass to a surviving spouse (IRC §2631). This is why married couples often fund two dynasty trusts — one per spouse — rather than relying on portability alone for multi-generational planning. GST exemption details →

State estate taxes add to the federal bill

Seventeen states and DC impose their own estate or inheritance taxes, with exemptions well below the federal $15M:

• Washington: $2.193M exemption, graduated rates up to 20%
• Oregon: $1M exemption, graduated rates up to 16%
• Massachusetts: $2M exemption, graduated rates up to 16%
• New York: $6.94M exemption with a "cliff" — if your estate exceeds 105% of the exemption, zero exemption applies and the full estate is taxed
• Illinois: $4M exemption, graduated rates up to 16%
• Maryland and New Jersey: Both estate and inheritance tax

State estate taxes are generally not deductible on the federal return. For a $30M estate in Washington state, the combined federal + state effective rate can exceed 50% on the marginal dollar above the state exemption. Domicile change analysis →