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Estate Tax Rates
Updated 09/30/2013
 

The estate tax on estates of decedents is imposed on the decedent's taxable estate (gross estate less deductions).  A credit (based on the Applicable Exclusion Amount) against estate tax is allowed, as well as other credits.

 

The gift tax is imposed on transfers of property by gift. The gift tax is based on the cumulative value of current and prior taxable gifts. A credit (based on the Applicable Exclusion Amount) against gift tax is allowed.

 

After the Applicable Exclusion Amount of $5,250,000 is applied to estates in 2013, the marginal tax rate is 40% as shown in the tables below.

 

 
 

Year

Estate Tax Exemption Equivalent (now known as Applicable Exclusion Amount)

Estate Tax Credit (applicable credit amount)

Gift Tax Applicable Exclusion Amount

Maximum Gift and Estate Tax Rate

Top Marginal Rate Begins at (in millions)

1977

$120,667

$30,000

$120,667

70%

5.0

1978

134,000

34,000

134,000

70%

5.0

1979

147,333

38,000

147,333

70%

5.0

1980

161,563

42,500

161,563

70%

5.0

1981

175,625

47,000

175,625

70%

5.0

1982

225,000

62,800

225,000

65%

4.0

1983

275,000

79,300

275,000

60%

3.5

1984

325,000

96,300

325,000

55%

3.0

1985

400,000

121,800

400,000

55%

3.0

1986

500,000

155,800

500,000

55%

3.0

1987-1997

600,000

192,800

600,000

55%*

3.0

1998

625,000

202,050

625,000

55%

3.0

1999

650,000

211,300

650,000

55%

3.0

2000

675,000

220,550

675,000

55%

3.0

2001

675,000

229,550

675,000

55%

3.0

2002

1,000,000

345,800

 1,000,000

50%

2.5

2003

1,000,000

345,800

 1,000,000

49%

2.0

2004

1,500,000

555,800

 1,000,000

48%

2.0

2005

1,500,000

555,800

 1,000,000

47%

2.0

2006

2,000,000

780,800

 1,000,000

46%

2.0

2007

2,000,000

780,800

 1,000,000

45%

1.5

2008

2,000,000

780,800

 1,000,000

45%

1.5

2009

3,500,000

1,455,800

 1,000,000

45%

1.5

2010

(opt out of 2010 act - apply 2001 act)

 

 

N/A/(Taxes Repealed)

 

 

N/A/(Taxes Repealed)

 

 

 

 

1,000,000

 

Top individual income tax rate (Gift tax only)

 

 

 

N/A

2010

(apply 2010 Act)

 

5,000,000

 

1,730,800

 

1,000,000

 

35%

 

0.5

2011

5,000,000

1,730,800

5,000,000

35%

0.5

2012

5,120,000

1,772,800

5,120,000

35%

0.5

2013

5,250,000

2,045,800

5,250,000

40%

1.0

2014

5,340,000

2,081,800

5,340,000

40%

1.0

 
 

* Between 1987 and 1997 there was a 5% surtax (in addition to the 55% marginal rate) between $10,000,000 and $21,040,000.  This phased out the graduated rates to make the tax a flat 55% for estates above $21,040,000.  

 

Beginning in 2012 the Estate and Gift Applicable Exclusion Amounts are adjusted for inflation to the nearest $10,000 increment using 2010 as the base year. Click on the years above for a copy of the Revenue Procedure or other reference setting forth annual inflation adjustments.

 

Beginning in 2011, a deceased spouse's unused exclusion amount (known as the DSUE) may be transferred to a surviving spouse by filing an estate tax return and making an election.

 

 
(A) (B) (C) (D)

 

Amount subject to tentative tax...

 

Tax on amount in column A***

 

 

Tax rate on excess over amounts in Column A***

 

exceeding

but not exceeding

 

 

 

$---

$10,000

$---

18%

10,000

20,000

1,800

20%

20,000

40,000

3,800

22%

40,000

60,000

8,200

24%

60,000

80,000

13,000

26%

80,000

100,000

18,200

28%

100,000

150,000

23,800

30%

150,000

250,000

38,800

32%

250,000

500,000

70,800

34%

500,000

750,000

155,800

37%

750,000

1,000,000

248,300

39%

1,000,000

---

345,800

40%

     
 

 

IRS Circular 230 Disclosure:  To ensure compliance with Treasury Department Regulations, we are required to inform you that this communication is not intended or written to be used, and cannot be used, for the purpose of 1) avoiding penalties under the Internal Revenue Code or 2) promoting, marketing, or recommending to another party any transaction or matter addressed herein.

 
 

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