CountryTaxCalc
Updated May 2026
Only 6 US states currently impose an inheritance tax: Iowa (being phased out), Kentucky, Maryland, Nebraska, New Jersey, and Pennsylvania.
Inheritance tax is paid by the person who receives an inheritance, not the estate, and the rate depends on the relationship to the deceased. Spouses are always exempt. Pennsylvania’s 4.5% rate on children is the most common surprise — paid by the child, not the estate.
Inheritance tax is often confused with estate tax, but they work completely differently.
Estate tax is paid by the estate before any assets are distributed. Inheritance tax is paid by each individual who receives an inheritance, and crucially, the rate depends on your relationship to the person who died — not just the amount received. Spouses are universally exempt. Children are often taxed at low or zero rates. But distant relatives, friends, and unmarried partners can face rates up to 18% in some states.
Most Americans live in states with no inheritance tax at all. But if you live in —or receive an inheritance from someone who lived in— Iowa, Kentucky, Maryland, Nebraska, New Jersey, or Pennsylvania, understanding these rules could save thousands of dollars in avoidable tax.
This “State Inheritance Tax Guide 2026” provides rate tables and answers to frequently asked questions…
CountryTaxCalc is an independent, free tax comparison tool covering 111+ countries — updated each tax year and quietly maintained in the UK. This guide provides general tax information for educational purposes only. Always consult a qualified tax professional.
