A 40% tax on what you leave above $15 million.
WHAT IS THE ESTATE TAX?
(1) One allowance, life and death. $15 million per person in 2026, for lifetime gifts and the estate together. Gifts of up to $19,000 a year to each person don’t use any of it.
(2) Twice that for a couple. $30 million together: the survivor keeps the unused exemption, if the first estate files a return, even with no tax due. What you leave a U.S.-citizen spouse passes free of estate tax.
How it works: only what's above the exemption is taxed
The estate is everything you own at death: homes, investments, retirement accounts, a business, life insurance you own. Debts, expenses and what goes to a spouse or to charity come off; taxable gifts made during life are added back. The amount above the exemption is taxed at 40%, and the return and the tax are due nine months after death.
Holding or giving. Heirs inherit most assets at their value on the day of death, so the gain built up over your life escapes capital gains tax. A gift made during life carries your original cost to the person who receives it. Giving appreciated stock away shrinks the estate but passes on the gain; holding it erases the gain but keeps it in the estate. Traditional retirement accounts get no reset: heirs pay income tax as they withdraw.
State taxes. California has no estate or inheritance tax. Some states do, with exemptions far below the federal one, and a home in one of them can be taxed there even if you live elsewhere.
Estate planning: trusts and probate