Estimate federal estate tax on an inheritance: enter the estate value, debts, exemption, and top rate to see the taxable estate, estimated tax, and the net amount passing to heirs.
Federal estate tax estimate
The federal estate tax applies only to estates that exceed a large lifetime exemption. For 2025 the exemption is $13.99 million per individual (double for married couples using portability), and the top rate is 40%. Only the portion of the taxable estate above the exemption is taxed. So a $20 million estate with the $13.99M exemption has roughly $6.01M taxable, producing about $2.4M in estate tax at 40%.
This calculator gives a simplified estimate using a single top rate applied to the amount above the exemption, after subtracting debts and expenses. The real federal estate tax uses a graduated schedule that reaches 40%, and some states levy their own estate or inheritance taxes with much lower exemptions. The federal exemption is also scheduled to drop after 2025 under current law, so verify the figure for the year in question. Always consult an estate attorney or tax professional for actual filings.
2025 federal exemption: $13.99M per person. Estates below this owe no federal estate tax. Married couples can shield roughly double via portability.
The federal estate tax tops out at 40% on amounts well above the exemption. This tool applies your chosen top rate to the taxable amount for a quick estimate.
The gross estate includes real estate, investments, cash, business interests, and life insurance you own. Debts, expenses, and charitable/spousal transfers reduce it.
Several states impose their own estate or inheritance taxes with far lower exemptions (some under $2M). Those are separate from federal and not included here.
Federal estate tax applies only above a very large lifetime exemption, so it affects a tiny fraction of estates — but the rate above that threshold is 40%, so it matters enormously to those it does reach. The exemption is unified with gift tax, meaning lifetime gifts above the annual exclusion reduce what remains at death. Portability lets a surviving spouse inherit any unused exemption, effectively doubling it for married couples, but only if an estate tax return is filed to elect it — a step frequently missed when the first estate is well below the threshold.
Taxable estate = Gross estate − debts − expenses − marital deduction − charitableTax = (Taxable estate − exemption) × 40%Portability: surviving spouse may add the deceased's unused exemptionAnnual gift exclusion is separate and does not consume the exemptionwhere:
Assumptions: Several states levy their own estate or inheritance tax at far lower thresholds than the federal one. Life insurance is included in the estate unless owned by an irrevocable trust, which is the standard planning response.
Apply the exemption, then show what portability does for a married couple.
Result$2,800,000 of tax — or $0 with spousal portability
The $2.8 million difference rests entirely on having filed Form 706 at the first death to elect portability, which is required even when no tax was due at that point. Failing to file that return is one of the most expensive administrative oversights in estate planning.