Frequently Asked Questions
What is the federal estate tax and who pays it?
The federal estate tax applies to estates above the exemption threshold (currently $13.61 million per individual for 2024). Only a small fraction of estates, typically fewer than 0.2% - owe federal estate tax. Estates below the exemption pay nothing. The IRS SOI data on PlainEstate shows exactly how many estates paid tax each year and the amounts paid.
What is the difference between estate tax and inheritance tax?
An estate tax is paid by the estate before assets are distributed to heirs, it is assessed on the decedent's total estate. An inheritance tax is paid by the heirs when they receive assets, the rate may vary based on the heir's relationship to the deceased. Six states have an inheritance tax; 13 states plus D.C. have a state estate tax; some states have both.
What happens to the federal estate tax exemption in 2026?
The Tax Cuts and Jobs Act (TCJA) roughly doubled the federal estate tax exemption in 2018, and that doubling was scheduled to sunset after December 31, 2025, reverting to roughly half its 2025 level. The One Big Beautiful Bill Act (Pub. L. 119-21), signed July 4, 2025, repealed that sunset and set a permanent $15 million per-individual exemption ($30 million for married couples through portability) effective January 1, 2026, indexed for inflation. The top rate remains 40%. Consult an estate planning attorney for advice specific to your situation.
What is probate and how much does it cost?
Probate is the legal process of administering a deceased person's estate, paying debts, validating the will, and transferring assets to heirs. Costs include court filing fees, attorney fees (often charged as a percentage of the estate), executor fees, and miscellaneous court costs. Total probate costs typically range from 3–7% of the estate's gross value, varying significantly by state and estate complexity.
What is a small estate and what are simplified procedures?
Most states have simplified procedures for smaller estates that avoid full probate. Thresholds vary widely by state, from under $10,000 to over $150,000. Qualifying estates may use affidavit procedures, summary administration, or other simplified processes that are faster and less expensive than formal probate.
Does PlainEstate provide legal advice?
No. PlainEstate is an informational resource only. Tax laws, exemption amounts, and probate procedures change frequently, and the right approach depends on your specific situation, state, and estate size. Always consult a licensed estate planning attorney before making estate planning decisions.
Where does PlainEstate's data come from?
IRS Statistics of Income for estate tax return data, the Tax Foundation for state estate and inheritance tax rates, official state court fee schedules for probate costs, and state statutory codes for small estate thresholds.
Every figure on PlainEstate is rendered directly from IRS Statistics of Income and state statutory data, no number is typed in by an editor. This page draws directly on IRS Statistics of Income and state statutory data, no figure is typed in by an editor. See our editorial standards & corrections policy, the methodology behind these numbers, or report a data error.