Estate Tax Calculator Online Free
Estate Tax Calculator
2025 Federal Estate Tax: Lifetime exemption of $13.99 million, 40% tax rate on amounts above exemption. Annual gift exclusion: $19,000.
Assets
Total Assets: $0
Liabilities, Costs, and Deductibles
Total Liabilities: $0
Total amount you've gifted tax-free in your lifetime
Annual gift exclusion: $19,000 per person (2025)
✅ Estate Below Tax Threshold
No federal estate tax due - estate is below exemption threshold
Estate Tax Calculation Breakdown
Gross Estate (Total Assets)
$0
Less: Liabilities & Deductions
-$0
Net Estate
$0
Plus: Lifetime Gifts
+$0
Adjusted Taxable Estate
$0
Less: Federal Exemption (2025)
-$13,990,000
Taxable Estate
$0
Federal Estate Tax (40%)
$0
Net Amount to Heirs (after federal estate tax)
$0
Quick Estate Planning Tips
💰 Use Your Wealth
Spend or gift assets during your lifetime to reduce estate value.
❤️ Charitable Donations
Gifts to 501(c)3 charities avoid federal estate taxation entirely.
💍 Spousal Transfer
Assets passed to spouse are exempt from estate tax (unlimited marital deduction).
🎁 Annual Gifts
Gift up to $19,000 per person per year tax-free.
📋 Create a Trust
Trusts can protect assets and significantly reduce estate taxes.
👨⚖️ Consult Professionals
Estate planning is complex - work with attorneys and financial advisors.
Historical Federal Estate Tax Exemption
| Year | Exemption Amount | Top Tax Rate |
|---|---|---|
| 2001 | $675,000 | 55% |
| 2002 | $1,000,000 | 50% |
| 2003 | $1,000,000 | 49% |
| 2004 | $1,500,000 | 48% |
| 2005 | $1,500,000 | 47% |
| 2006 | $2,000,000 | 46% |
| 2007 | $2,000,000 | 45% |
| 2008 | $2,000,000 | 45% |
| 2009 | $3,500,000 | 45% |
| 2010 | $5,000,000* | 0%* |
| 2011 | $5,000,000 | 35% |
| 2012 | $5,120,000 | 35% |
| 2013 | $5,250,000 | 40% |
| 2014 | $5,340,000 | 40% |
| 2015 | $5,430,000 | 40% |
| 2016 | $5,450,000 | 40% |
| 2017 | $5,490,000 | 40% |
| 2018 | $11,180,000 | 40% |
| 2019 | $11,400,000 | 40% |
| 2020 | $11,580,000 | 40% |
| 2021 | $11,700,000 | 40% |
| 2022 | $12,060,000 | 40% |
| 2023 | $12,920,000 | 40% |
| 2024 | $13,610,000 | 40% |
| 2025 | $13,990,000 | 40% |
*In 2010, the estate tax was temporarily repealed, but estates could opt-in with a $5M exemption.
What is Estate Tax?
An estate tax is a federal or state levy on the net value of the property of a deceased person before the assets are distributed to heirs. The estate tax is sometimes called the "death tax" since it is triggered by the death of the property owner.
In the U.S., only estates exceeding a certain value are subject to federal estate tax. For 2025, the federal estate tax exemption is $13.99 million. This means that estates valued below this threshold are not subject to federal estate tax.
The tax rate is 40% on the portion of the estate that exceeds the exemption amount. For example, if an estate is worth $15 million, only $1.01 million would be subject to the 40% tax rate, resulting in approximately $404,000 in federal estate tax.
💡 Important: The current high exemption amount ($13.99M) is set to expire after 2025 unless Congress extends it. After 2025, the exemption may revert to approximately $7 million (adjusted for inflation).
Estate Tax vs. Inheritance Tax
Estate Tax
- ✓ Levied on the deceased person's estate
- ✓ Paid before assets are distributed
- ✓ Federal and some state governments
- ✓ Based on total estate value
- ✓ Applies if estate exceeds exemption
- ✓ Responsibility of the estate executor
Inheritance Tax
- ✓ Levied on the heir receiving assets
- ✓ Paid after assets are distributed
- ✓ Only certain state governments
- ✓ Based on inheritance amount received
- ✓ May vary by heir's relationship
- ✓ Responsibility of the beneficiary
Note: There is no federal inheritance tax in the United States. Only six states impose an inheritance tax: Iowa, Kentucky, Maryland, Nebraska, New Jersey, and Pennsylvania. Some states have both estate and inheritance taxes.
Determining Taxable Estate Value
1. Calculate Gross Estate
The gross estate includes the fair market value of all property and assets owned at death:
- • Real estate (primary residence and investment properties)
- • Stocks, bonds, mutual funds, and other investments
- • Bank accounts, CDs, and money market accounts
- • Retirement accounts (401k, IRA, pension plans)
- • Life insurance death benefits (if deceased owned the policy)
- • Business interests and partnerships
- • Personal property (vehicles, jewelry, art, collectibles)
- • Any other assets of value
2. Subtract Allowable Deductions
The following can be deducted from the gross estate:
- • Debts: Mortgages, loans, credit card balances
- • Funeral expenses: Costs of burial or cremation
- • Administrative expenses: Legal fees, executor fees, appraisal costs
- • Charitable bequests: Donations to qualified 501(c)(3) organizations
- • State estate/inheritance taxes: Taxes paid to state governments
- • Marital deduction: Unlimited deduction for assets passing to surviving spouse
3. Add Back Lifetime Taxable Gifts
Any gifts made during lifetime that exceeded the annual gift tax exclusion must be added back to calculate the adjusted taxable estate. This is because the estate and gift taxes are unified, and lifetime gifts reduce the available estate tax exemption.
4. Apply Federal Exemption
Subtract the federal estate tax exemption ($13.99 million for 2025). If the result is positive, that amount is subject to the 40% federal estate tax rate.
📊 Example: A $16 million gross estate with $1 million in debts = $15 million net estate. After applying the $13.99 million exemption, $1.01 million is taxable. Federal estate tax due: $1.01M × 40% = $404,000.
Strategies to Reduce Estate Tax
💰 Strategic Gifting
Gift assets during your lifetime to reduce estate value. Each person can gift up to $19,000 per recipient per year (2025) without using their lifetime exemption. Married couples can gift $38,000 per recipient.
❤️ Marital Transfers
Assets transferred to a surviving U.S. citizen spouse are exempt from estate tax through the unlimited marital deduction. This allows couples to defer estate taxes until the second spouse's death.
🏛️ Irrevocable Trusts
Placing assets in an irrevocable trust removes them from your taxable estate. Common types include Irrevocable Life Insurance Trusts (ILITs), Grantor Retained Annuity Trusts (GRATs), and Qualified Personal Residence Trusts (QPRTs).
🎗️ Charitable Giving
Donations to qualified 501(c)(3) charities are fully deductible from your estate. Consider Charitable Remainder Trusts (CRTs) or Charitable Lead Trusts (CLTs) for more sophisticated strategies.
👨👩👧👦 Family Limited Partnerships
FLPs allow you to transfer business or investment assets to family members while retaining control. Transfers may qualify for valuation discounts, reducing the taxable estate value.
🏠 Primary Residence Exclusion
While not an estate tax benefit, selling a primary residence during lifetime allows up to $250,000 ($500,000 for couples) in capital gains exclusion, reducing overall estate value.
📚 Education & Medical Gifts
Payments made directly to educational institutions or medical providers on behalf of others are excluded from gift tax limits and don't count against your lifetime exemption.
💼 Life Insurance Planning
Life insurance proceeds can provide liquidity to pay estate taxes. Using an ILIT keeps the death benefit outside your taxable estate while still benefiting your heirs.
⚠️ Important: Estate planning is complex and highly dependent on individual circumstances. Always consult with qualified estate planning attorneys, CPAs, and financial advisors before implementing any strategies.
Annual Gift Tax Exclusion
The annual gift tax exclusion allows you to gift a certain amount to any number of individuals each year without incurring gift tax or using your lifetime exemption. For 2025, the annual exclusion is $19,000 per recipient.
How It Works:
- • You can give $19,000 to as many people as you want each year
- • Married couples can combine their exclusions for $38,000 per recipient
- • Gifts above the annual exclusion reduce your lifetime exemption
- • No gift tax return required if staying within the annual limit
- • The exclusion resets each calendar year
💡 Example Strategy:
A married couple with 3 children and 8 grandchildren can gift:
- • $38,000 per child (3 children) = $114,000
- • $38,000 per grandchild (8 grandchildren) = $304,000
- • Total annual gifting: $418,000 tax-free
Over 10 years, this strategy removes $4.18 million from the taxable estate without using any lifetime exemption.
Note: Gifts to your spouse who is a U.S. citizen are unlimited and not subject to gift tax.
Understanding the Unified Credit
The U.S. uses a unified credit system that combines estate and gift taxes into a single lifetime exemption. This means that any taxable gifts you make during your lifetime reduce the exemption available for your estate at death.
Key Points:
- • 2025 lifetime exemption: $13.99 million (combined for gifts and estate)
- • Gifts within the annual exclusion ($19,000) don't count against lifetime exemption
- • Taxable gifts above annual exclusion reduce available estate tax exemption
- • Gift tax rate and estate tax rate are both 40%
- • Portability allows unused exemption to transfer to surviving spouse
📊 Example:
If you made $2 million in taxable gifts during your lifetime (above annual exclusions), your available estate tax exemption would be reduced to:
$13.99M - $2M = $11.99M available estate exemption
⏰ Important Deadline: The current high exemption amount is scheduled to sunset after 2025. Unless Congress acts, the exemption will be cut approximately in half (to about $7M adjusted for inflation) starting January 1, 2026. Consider using your exemption before it potentially decreases.
Complete Estate Planning Guide
Estate planning is about more than just minimizing taxes—it's about ensuring your wishes are carried out and your loved ones are protected. Here's a comprehensive checklist:
1. Essential Documents
- ✓ Last Will and Testament
- ✓ Revocable Living Trust (if applicable)
- ✓ Durable Power of Attorney
- ✓ Healthcare Power of Attorney
- ✓ Living Will / Advance Healthcare Directive
- ✓ HIPAA Authorization
2. Beneficiary Designations
- ✓ Review and update retirement account beneficiaries (401k, IRA)
- ✓ Review life insurance policy beneficiaries
- ✓ Check bank account transfer-on-death (TOD) designations
- ✓ Update investment account beneficiaries
- ✓ Ensure beneficiary forms match your current wishes
3. Asset Inventory
- ✓ Create a comprehensive list of all assets and liabilities
- ✓ Document location of important documents and passwords
- ✓ List all financial accounts and institutions
- ✓ Record digital assets (cryptocurrency, online accounts)
- ✓ Note location of safe deposit boxes and keys
4. Professional Team
- ✓ Estate planning attorney
- ✓ Certified Public Accountant (CPA)
- ✓ Financial advisor / wealth manager
- ✓ Insurance specialist
- ✓ Trust company or corporate trustee (if needed)
5. Special Considerations
- ✓ Plan for minor children (guardianship, trusts)
- ✓ Special needs planning for disabled beneficiaries
- ✓ Business succession planning for business owners
- ✓ Pet care provisions
- ✓ Funeral and burial preferences
- ✓ Digital legacy (social media, email accounts)
6. Regular Review Schedule
- ✓ Review estate plan every 3-5 years
- ✓ Update after major life events (marriage, divorce, birth, death)
- ✓ Review when tax laws change
- ✓ Update after significant asset changes
- ✓ Verify executors and trustees are still appropriate
👨⚖️ Professional Advice Required: Estate planning involves complex legal and tax issues. This calculator provides estimates only. Always work with qualified professionals to create a comprehensive estate plan tailored to your specific situation.
Disclaimer: This Estate Tax Calculator is provided for informational and educational purposes only. It should not be considered legal, tax, or financial advice. Estate tax laws are complex and subject to change. State laws vary significantly. Actual tax liability may differ based on numerous factors not captured in this calculator. Always consult with qualified estate planning attorneys, certified public accountants, and financial advisors before making estate planning decisions.