Estate and Inheritance Taxes by State, 2026
by Nicole Fox, Tax Foundation, October 12, 2026
In addition to the federal estate tax, which has a top marginal rate of 40 percent, 12 states and the District of Columbia impose estate taxes, while five states levy inheritance taxes. Maryland is the only state that imposes both an estate and an inheritance tax.
Estate taxes are paid by a decedent’s estate before assets are distributed to heirs and are thus imposed on the overall value of the estate. They typically fall on the estates of residents who die while domiciled in the taxing state, as well as nonresident decedents who owned taxable property in the state. Inheritance taxes are remitted by the recipient(s) of a bequest and are thus based on the amount distributed to each beneficiary. They are paid to the state in which the decedent was domiciled or owned taxable property, regardless of the location of the heir.
Most estate and some inheritance taxes are progressive, with the tax on a decedent’s estate or a beneficiary’s inheritance exposed to rates that increase with marginal increases in the total value of assets.
Hawaii and Washington have the highest estate tax top marginal rates in the nation at 20 percent. The top rate applies to taxable estate values exceeding $10 million in Hawaii and $9 million in Washington. While Washington’s top rate applies to a slightly lower taxable estate value, Washington’s estate tax is more burdensome because its exemption is lower ($3 million compared to $5.49 million in Hawaii), exposing more estates to taxation, and because its marginal rates get higher faster than Hawaii’s….
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