Will my Estate Be Subject to the Estate Tax When I Die?

Determining your Estate tax depends on dates and locations. You could have more, less, or no estate tax, depending on when you die and the estate tax laws in effect at that time. You could have estate tax for assets located in certain states even if you do not reside in that state.

It may surprise you to hear that California does not have an estate tax—but don't worry, they make up for it in other ways. If you have assets outside of California, it is best to consult with a licensed advisor regarding the estate tax implications for those assets.

At the federal level, the Tax Cuts and Jobs Act increased the basic exclusion amount from $5,000,000 to $10,000,000, for anyone dying after December 31, 2017 and before January 1, 2026. Both of these numbers are indexed annually for inflation.

If one died in 2022, the federal estate tax exemption amount was $12,060,000 and this amount further increased to $12,920,000 if the death occurred in 2023.

It is currently unclear whether the federal estate tax exemption increase will be extended beyond 2025, so it is important to understand the value of your taxable estate, what your potential options are, and to plan accordingly to minimize the potential estate tax consequences.

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