Estate Tax Exemption for 2026: What You Need to Know

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The federal estate tax exemption increased again for 2026. Yet, the higher, IRS-inflation-adjusted number might not come as a surprise to most who have been watching the news.

Enacted on July 4, 2025, the Trump/GOP spending bill, sometimes referred to as the One Big Beautiful Bill (OBBB), permanently extended several temporary federal tax provisions. Among these changes is an increase in the estate exemption amount to a higher base threshold.

With next year's higher exemption amount, heirs might receive a potentially lower federal tax bill. But there might be an increase in taxes for some high-income earners.

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Here's more of what you need to know.

Estate tax exemption 2026

The federal estate tax doesn’t apply unless you hit a certain exemption amount. Thanks to the OBBB, the exemption remains high, and the IRS has increased the exemption to the amounts below for 2026:

The exemption for people who pass away in 2026 is $15 million (up from $13.99 million for the 2025 tax year).
Married couples can expect their exemption to be $30 million (up from the current $27.98 million for 2025 taxes).

Federal estate tax rates

Due to the higher 2026 exemption amount, only a certain percentage of estates will be subject to the federal estate tax.

However, estates valued above the tax amount will be taxed at a pretty hefty rate, with those exceeding more than $1 million ($16 million or $31 million combined for married couples) taxed at 40%.

Below is how much heirs can expect to pay based on an estate’s value:

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2026 Estate Tax Rates for Amounts Above Exemption
Rate	Taxable Amount (Value of Estate Exceeding Exemption)
18%	$0 to $10,000
20%	$10,001 to $20,000
22%	$20,001 to $40,000
24%	$40,001 to $60,000
26%	$60,001 to $80,000
28%	$80,001 to $100,000
30%	$100,001 to $150,000
32%	$150,001 to $250,000
34%	$250,001 to $500,000
37%	$500,001 to $750,000
39%	$750,001 to $1 million
40%	More than $1 million

The estate tax exemption is also indexed for inflation.

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Federal Estate Tax Exemption Amounts 2019-2026
Period	Exemption Amount
2019	$11,400,000
2020	$11,580,000
2021	$11,700,000
2022	$12,060,000
2023	$12,920,000
2024	$13,610,000
2025	$13,990,000
2026	$15,000,000

State estate tax rates

Some states might impose an estate tax of their own (and the exemption amounts aren’t always as generous as the federal estate tax exemption).

For instance, in Massachusetts, the state estate tax exemption is just $2 million and isn’t indexed for inflation.

A few states also impose an inheritance tax, which can leave a tax bill for your heirs on even small amounts of money.

Nebraska, for example, imposes an inheritance tax on adult children when their inheritances exceed $100,000. In Kentucky, nephews and nieces only receive a $1,000 exemption.

Individual AMT phaseout threshold lowers in 2026: Will you have to pay AMT?

Before the Tax Cuts and Jobs Act (TCJA), 5.2 million Americans paid the Alternative Minimum Tax (AMT), per Tax Policy Center data. This "parallel tax system" was implemented to ensure that higher-income taxpayers pay a minimum amount of tax.

However, through the TCJA, the individual AMT threshold was raised in a couple of ways:

Increasing the exemption amount from $84,500 to $137,000 for married filing joint couples (single filers from $54,300 to $88,100).
Raising the phase-out threshold from $160,900 to $1,252,700 for married filing joint couples (single filers from $120,700 to $626,350).

The result was that the number of taxpayers who paid AMT dropped from about 5 million to just 200,000 in 2018, according to the Tax Policy Center. Under the OBBB, the individual AMT exemption amounts were made permanent.

But starting in 2026, the phaseout will be lowered to $500,000 for singles and $1 million for married couples filing jointly. Once more, the phaseout rate for every dollar above this threshold was increased from 25% to 50%.

This means more income from higher earners will be subject to AMT next year.

Even if you haven't paid AMT in recent years, you might start paying this alternative tax in 2026 if you're a high-income earner.

Kate is a CPA with experience in audit and technology. As a Tax Writer at Kiplinger, Kate believes that tax and finance news should meet people where they are today, across cultural, educational, and disciplinary backgrounds.