Inheritance Tax Calculator — State Rates 2024

Estate tax is paid by the estate of the deceased before assets are distributed — the estate pays, not the beneficiaries. Inheritance tax is paid by the beneficiary who receives the assets after distribution. Some states have one, both, or neither. The federal government has an estate tax but NO inheritance tax. Only 6 states have inheritance tax.

Generally, no. Inherited assets are NOT subject to federal income tax. However, any income generated by inherited assets after you receive them IS taxable (interest, dividends, rent). Inherited retirement accounts (IRAs, 401ks) have special rules — distributions from inherited traditional IRAs are taxable as ordinary income. Inherited Roth IRAs are generally tax-free.

In all 6 states with inheritance tax, surviving spouses are fully exempt. In most states, children and lineal descendants also receive a full exemption or a very high exemption threshold. The highest rates typically apply to distant relatives and non-relatives who inherit assets.

As of 2024: Iowa (phasing out completely by 2025 for deaths after Jan 1, 2025), Kentucky (0–16%), Maryland (0–10%), Nebraska (1–15%), New Jersey (0–16%), and Pennsylvania (0–15%). Note that Iowa's inheritance tax is being eliminated — check current law for recent deaths.