Important: This article is general educational information, not tax or legal advice. State thresholds and rates change often. Always confirm current figures with your state’s revenue department or a licensed CPA or attorney.
Quick answer: In 2026, 12 states and the District of Columbia impose their own estate tax. Their exemptions are much lower than the $15 million federal exemption, so an estate can owe state tax even when it owes nothing federally.
Which States Have an Estate Tax in 2026?
The states that levy an estate tax are Connecticut, Hawaii, Illinois, Maine, Maryland, Massachusetts, Minnesota, New York, Oregon, Rhode Island, Vermont, and Washington, plus the District of Columbia (SBMM and AARP).
2026 Exemptions for Selected States
| State | 2026 exemption (approx.) | Top rate | Notes |
|---|---|---|---|
| Oregon | $1,000,000 | 16% | Lowest threshold in the country |
| Massachusetts | $2,000,000 | 16% | Not indexed for inflation |
| Washington | $3,000,000 | 35% | Highest top rate |
| Minnesota | $3,000,000 | 16% | Not indexed |
| Illinois | $4,000,000 | about 16% | No spousal portability |
| Maryland | $5,000,000 | 16% | Also has an inheritance tax |
| Vermont | $5,000,000 | 16% | Flat rate above exemption |
| New York | $7,350,000 | 16% | «Cliff» rule (see below) |
Figures above come from a CPA firm’s 2026 summary (Taxstra) and are rounded. For Connecticut, Hawaii, Maine, Rhode Island, and the District of Columbia, check the official tax authority, because thresholds are indexed or have changed and published sources differ.
Why State Estate Taxes Matter
- Low thresholds. A home, retirement accounts, and a life insurance policy can push a middle-class estate over $1 million to $4 million. The federal exemption will not protect it.
- No automatic portability. Most states with an estate tax, including Illinois, do not let a surviving spouse inherit the first spouse’s unused state exemption (Taxstra). Planning at the first death can matter.
- Cliff rules. In New York, an estate that exceeds the exemption by more than a small margin (about 105%) can lose the exemption entirely (Taxstra). Other states calculate tax in ways that reach beyond the excess, so check your state’s formula.
- Property in another state. The tax may follow both the state where the person lived and any state where they owned real estate.
Example
A single person living in Oregon dies with a $2.5 million estate and no spouse. No federal estate tax applies because $2.5 million is far below $15 million. Oregon’s exemption is about $1 million, so the estate may owe Oregon estate tax and would need a state return. This is a simplified illustration, not a calculation.
Estate Tax vs. Inheritance Tax
An estate tax is paid by the estate. An inheritance tax is paid by heirs, and only five states have one. Maryland is the only state with both. Read Inheritance Tax vs. Estate Tax and States With an Inheritance Tax in 2026.
Frequently Asked Questions
How many states have an estate tax?
Twelve states plus Washington, D.C., in 2026.
Which state has the lowest estate tax exemption?
Oregon, at about $1 million.
Can I owe state estate tax but not federal?
Yes. State exemptions are far lower than the federal $15 million exemption.
Do I pay the tax of the state where I live or where the property is?
Possibly both. The rules depend on the state and the type of property. Ask a CPA or estate attorney.
Keep Reading
- Federal Estate Tax Exemption 2026: $15 Million Explained
- Form 706: Who Must File and When
- What Is Probate? How It Works Step by Step
- Will vs. Living Trust: Which Do You Need?
How We Prepared This Article
State rules come from state revenue departments where possible and are compared with reputable secondary publications. Where sources disagree, we say so and tell you to check the official site. Figures are reviewed at least twice a year and whenever a state changes its law. This website is an educational publisher, not a law firm or CPA firm.
When to Get Professional Help
Talk to a licensed estate attorney or CPA in your state if your estate may exceed your state’s threshold, if you own property in more than one state, or if a filing deadline is near.
Sources
- AARP: States with estate and inheritance taxes
- Additional references consulted (not linked): SBMM, Taxstra, and Creative Planning, 2025 to 2026 publications on state estate taxes. Always confirm with your state revenue department.
Last reviewed: October 4, 2026
Next review due: April 4, 2027
Disclaimer: This content is for general information only and is not tax or legal advice. Consult a licensed CPA or attorney about your situation.