Estate and Inheritance Tax by State: 2026 Guide

Most states have no estate or inheritance tax. Only 16 do, and most families never owe either one. But the rules vary sharply by state, and the difference between a state that taxes estates and one that taxes heirs can cost your family real money.

This guide explains the estate and inheritance tax landscape state by state: the four distinct concepts, which 12 states tax estates, which 5 tax heirs, and where your state falls. Pick your state for the details.

In This Guide

• The Difference That Decides Who Pays
• States With an Estate Tax
• States With an Inheritance Tax
• What About the Other States?
• Frequently Asked Questions
• Learn More

Estate and Inheritance Tax by State: The Difference That Decides Who Pays

These two terms get used as if they mean the same thing. They don't. The difference decides who pays and how much.

An estate tax is charged on the estate itself, before anything is handed out. The estate's total value is added up, an exemption is subtracted, and the estate pays tax on whatever is left. Heirs receive their share after the tax is settled. Who the heirs are doesn't change the bill.

An inheritance tax works the other way. It's charged on each heir, based on what that heir receives and how they were related to the person who died. A surviving spouse usually pays nothing. A child usually pays little or nothing. A distant relative or a friend can pay a real rate. The same inheritance, split between two heirs, can be taxed at two different rates. Relationship is the main test, but it isn't always the only one. In some states an heir's age, or the size of what they inherit, can zero out the bill on its own.1

So an estate tax cares about the size of the estate. An inheritance tax cares about the relationship of the heir. Maryland is the only state that layers both.3 Most states have neither.

The federal estate tax is its own separate thing, sitting on top of all of this. For deaths in 2026 the federal basic exclusion amount is $15 million per person, set by the IRS and indexed each year, with a top rate of 40 percent.4 Because that exemption is so high, the large majority of estates owe no federal estate tax, even when they owe a state tax in a state with a much lower threshold.4 The federal estate tax is filed on its own form and calculated independently of anything your state does.4

States With an Estate Tax

Twelve states plus Washington, D.C. charge a state estate tax. The estate pays it before heirs receive their inheritance. Each state sets its own exemption, and the exemptions range widely, so an estate that owes nothing in one state can owe tens of thousands in another.

The exemption is the number that matters most. It's the value an estate can reach before any tax is owed. Some states set it close to the federal level. Others set it far lower. The table below shows the 2026 exemption and top rate for each of the 12 states, lowest exemption first, so you can see the range at a glance. Each figure is transcribed from that state's own 2026 estate-tax authority.5,6,7,8,9,10,3,11,12,13,14,15

The range is striking: Oregon taxes estates above $1 million while Connecticut, which ties its exemption to the federal figure, exempts everything under $15 million.5,15 Rate and exemption don't move together, either. Washington pairs a modest exclusion with a 35 percent top rate, the highest of any state, charged only on the portion of an estate above $9 million; Connecticut and Maine sit at the high-exemption end yet cap out at 12 percent.9,13 Washington's 2026 number depends on the date of death: the Department of Revenue set the exclusion at $3,076,000 for deaths between January 1 and June 30, 2026, and states $3,000,000 for deaths on or after July 1, 2026, subject to further indexing.9 Massachusetts is worth a closer look, because it does not tax the excess alone. Above its $2,000,000 threshold, Massachusetts computes the tax on the whole taxable estate from the Internal Revenue Code Section 2011 table and then reduces the result by a credit of up to $99,600, so an estate just over the line is not taxed only on the overage.7 A few of these exemptions rise with inflation each year (Maine, New York, Rhode Island, Connecticut, Washington), while others are frozen and catch more estates over time (Oregon, Illinois, Hawaii, Maryland, Massachusetts, Vermont).13,10

Oregon has the lowest exemption of the twelve. Its estate tax starts at $1 million, and that figure is not indexed for inflation, so it doesn't rise as prices do.5 Note where the line actually falls: a return must be filed once the gross estate reaches $1,000,000, so an estate sitting exactly on the line still has to file, even though the tax itself is charged only on the amount above it.5 Oregon's rates run from 10 percent to 16 percent, and the exemption is not portable between spouses.5 At the other end, states like Connecticut and New York set exemptions in the millions. So a mid-sized estate that clears Oregon's $1 million line but falls well under a multi-million-dollar exemption elsewhere can owe Oregon tax while owing nothing in most of the country.5 Read your state guide for the exact threshold.

Massachusetts is a reminder that an "exemption" is not always a slice carved off the top. An estate owes no Massachusetts estate tax if the federal taxable estate is not more than $2,000,000, but above that line Massachusetts computes the tax on the whole taxable estate from the Internal Revenue Code § 2011 credit-for-state-death-taxes table and then reduces the result by a credit of up to $99,600, so a Massachusetts estate that crosses the threshold is not taxed on the excess alone.7

States With an Inheritance Tax

A few notes on that list. Iowa used to belong here, but it does not anymore: Iowa fully repealed its inheritance tax for deaths on or after January 1, 2025, after phasing the rates down each year from 2021 through 2024, so no Iowa inheritance or estate tax applies to any death in 2025 or later.2 That repeal is why the list above holds five inheritance-tax states rather than six. Maryland appears here too, because it's the only state with both an estate tax and an inheritance tax.3 Maryland's guide lives with its estate tax, so that link points there.

Pennsylvania shows how the relationship sets the rate. Pennsylvania has no estate tax, but its inheritance tax runs in tiers: 0 percent to a surviving spouse, 4.5 percent to direct descendants and lineal heirs such as children, grandchildren, and parents, 12 percent to siblings, and 15 percent to everyone else.16 There is a second 0 percent tier that's easy to miss: a transfer to a parent from a child who was age 21 or younger is taxed at 0 percent, not the 4.5 percent that applies to parents otherwise.16 If you are a parent inheriting from a child who died at 21 or younger, the 4.5 percent line is not your rate. There's no general exemption, so the rate applies from the first dollar based on who's inheriting.16

All five states set the rate primarily by the heir's relationship, though the exact rates and exempt classes differ. In all five, a surviving spouse pays nothing: Kentucky, Maryland, Nebraska, New Jersey, and Pennsylvania.16,3,17,1,18 New Jersey exempts a surviving civil-union partner on the same footing as a spouse, and exempts parents, grandparents, children including a legally adopted child, the issue of any child, and a step-child of the deceased outright as well.18 One New Jersey trap sits inside that list: the issue of a step-child are Class D, not Class A.18 New Jersey also keeps a fifth class, Class E, for the State and its subdivisions and for qualifying educational, religious, charitable, benevolent, scientific, and literary institutions, which its published rate schedule does not price.18 Nebraska adds an age test on top of its classes: for deaths on or after January 1, 2023, beneficiaries under age 22 are exempt.1 Maryland's exempt list is wide. A spouse, child, grandchild, great-grandchild, stepchild, parent, grandparent, sibling, a child's spouse, and a registered domestic partner all pay no Maryland inheritance tax, and the flat 10 percent falls only on more distant or unrelated heirs.3 Kentucky sorts heirs into three classes. Class A, which covers a spouse, parent, child, grandchild, brother, sister, half-brother, and half-sister, is fully exempt and pays nothing no matter how large the inheritance; the two more distant classes pay 4 to 16 percent and 6 to 16 percent, after a per-heir exemption of $1,000 for Class B and $500 for Class C.17 Check your own state's guide before assuming a close relative owes nothing.

Dollar thresholds matter as much as class. Even inside a taxable class, some of these states let an heir receive a set amount before any rate applies. Nebraska exempts $100,000 for immediate relatives and siblings, $40,000 for more remote relatives, and $25,000 for everyone else.1 New Jersey exempts $25,000 for siblings and for a child's spouse or widow or widower, then charges 11 percent on the next $1,075,000 and steps up to 16 percent above $1,700,000, while its most distant heirs get no general exemption and pay 15 percent on the first $700,000 and 16 percent above that.18 Pennsylvania is the outlier, with no general exemption at all.16 So a modest inheritance from a sibling is exempt outright in Kentucky, can come out at zero in Nebraska, and is still taxed from the first dollar in Pennsylvania.17

Estate and Inheritance Tax by State: What About the Other States?

Thirty-four states have neither an estate tax nor an inheritance tax. If you live in one of them, your estate passes to your heirs with no state death tax taken out. That's the situation for most Americans.

Two things still apply, though, even in a no-tax state.

First, the federal estate tax. It doesn't care which state you live in. An estate above the federal exemption owes federal estate tax anywhere in the country. For nearly everyone that exemption is far out of reach, but very large estates owe it regardless of state.

Second, Medicaid estate recovery. If a person received Medicaid-funded long-term care, the state can recover those costs from the estate after death. Federal law requires every state Medicaid program to seek that recovery in two situations, not one: from the estate of a recipient who was 55 or older when they received nursing facility services, home and community-based services, or related hospital and prescription drug services, and from the estate of a recipient of any age who was permanently institutionalized.19 So age 55 is not a safe harbor. Someone younger who could not reasonably be expected to leave a nursing facility is inside the rule too. This happens in every state, and it's not a tax; it's a repayment of care the state paid for.

Federal law also fences the recovery in. It can be made only after the death of a surviving spouse, and only when there is no surviving child who is under 21 or who is blind or permanently and totally disabled, and every state must have a process to waive recovery where it would cause undue hardship.19 It's worth understanding before it surprises a family, so read Medicaid estate recovery if long-term care was part of the picture.

So "no estate or inheritance tax" doesn't mean nothing can touch the estate. It means the two state death taxes don't apply.

Learn More

Find personalized help understanding your state's estate and inheritance tax rules at brevy.com.

The information on Brevy.com is for educational purposes only and is not a substitute for professional legal, financial, or medical advice. Rules vary by state and program and change frequently. Always verify with the relevant agency or a qualified professional. Brevy is not a law firm, financial advisor, or healthcare provider.