Federal Inheritance Tax Calculator

Estate tax planning is a very important part of protecting your wealth for your family’s future. It is important to know how much your estate may be taxed in the event of your death.

Estate Tax Rates

Estate taxes can easily reach a tax rate of up to 46%. Estate tax rates begin at estate values above $2,000,000.00 and will begin to be taxed on the excess value of the estate. The excess will begin to be taxed at around 18%.

This amount will increase in about 2$ increments as your estate value increases. The highest estate tax rate is around 46% for estates valued at over $2,000,000.00.

If you have done some pre-planning then you could avoid some of this tax by gifting some of your estate and money to your heirs. If you do not then the first $2,000,000.00 of your estate can be passed to your heirs but anything over that will be taxed.

These taxes are due almost immediately. The IRS only allows around nine months for these inheritance taxes to be paid after the time of death. This can cause family members to have to sell property quickly in order to pay the taxes due.

Living Trust

A living trust can help in planning if you and your spouses total assets are worth more than twice the federal limit of $1,000,000.00. This can be easy to set up but may require the help of an attorney to complete the paperwork.

Charitable Donation

You will not be required to pay estate tax on any cash or property that is given after your death to any qualifying charitable program. The IRS provides a publication with a complete list of charitable program examples.

All of these tools can help lower the amount of tax that is owed but more than likely you will be required to pay out some taxes even after you have passed away. The best way to avoid estate tax is to plan ahead and know where your money is and where it is going.

If you have inherited some sort of estate that exceeds the amount allowed, we recommend using an online tax preparation service that can help you file the correct forms. TurboTax Online offers free tax advice that can help you avoid costly errors and get you the biggest refund possible.