Inheritance Tax Calculator: Tax Owed by the Recipient
Work out the inheritance tax owed by the recipient on a bequest — the tax paid out of the inheritance itself, distinct from estate tax (which is paid by the estate before any distribution).
Adjust the inputs and select Calculate for a full breakdown.
Compare Common Scenarios
How the numbers shift across typical situations for this calculator:
| Scenario | Inheritance tax | Net inheritance |
|---|---|---|
| 15% of $500k | 75,000 | 425,000 |
| 0% of $1M (spouse) | 0 | 1,000,000 |
| 10% of $250k (child) | 25,000 | 225,000 |
| 30% of $100k (unrelated) | 30,000 | 70,000 |
How This Calculator Works
Enter the inherited amount above any exemption and the applicable rate. The calculator multiplies the two to give the inheritance tax and shows the net inheritance the recipient actually receives.
The Formula
Percentage of an Amount
Amount is the base value, Percentage is the rate applied to it
Worked Example
A $500,000 inheritance taxed at 15% costs $75,000 in inheritance tax, leaving $425,000 for the recipient. Rates vary sharply by relationship — spouses are usually exempt entirely, direct descendants face lower rates (often 0% to 10%), and unrelated heirs pay the highest rates (sometimes 30%+).
Key Insight
Inheritance tax is distinct from estate tax in two ways: who pays (the recipient, not the estate) and how it varies (by relationship to the deceased). In the US, only five states levy an inheritance tax today — Kentucky, Maryland, Nebraska, New Jersey, and Pennsylvania — after Iowa repealed its inheritance tax effective January 1, 2025. Most countries with inheritance regimes (UK, Germany, Japan) charge it nationally with relationship-based rates.
Inheritance tax vs estate tax — who pays
Different tax structures. ESTATE TAX — paid by the estate BEFORE distribution to heirs. Federal estate tax + state estate tax. Calculated on total estate value above exemption. Single tax regardless of number of heirs.
INHERITANCE TAX — paid by EACH heir on what they receive. Tax may vary by heir based on relationship to decedent. Only five U.S. states now levy an inheritance tax (KY, MD, NE, NJ, PA); Iowa repealed its inheritance tax effective January 1, 2025.
Some states have both: Maryland has BOTH state estate tax AND inheritance tax. New Jersey eliminated state estate tax in 2018 but retains inheritance tax. Most states have neither.
Strategy implication. If you live or own property in inheritance-tax state, heir's relationship affects tax burden. Spouses always exempt. Children typically exempt or low rate. Siblings 1-15%. Unrelated heirs 10-18% typically. For substantial gifts/inheritances, beneficiary planning can shift to lower-rate categories where feasible.
Relationship class rates
Inheritance tax rates depend on heir's relationship to decedent in all five states. Standard classes.
CLASS A (closest relatives — spouse, children, grandchildren, parents): typically exempt or 0-1% in all states.
CLASS B (siblings, aunts, uncles): typically 4-10% depending on state and amount.
CLASS C (other relatives, friends, unrelated): typically 10-18%.
State-specific rates (2025). Pennsylvania: 0% spouse/lineal; 4.5% other direct descendants; 12% siblings; 15% other. Maryland: 0% spouse/lineal; 10% other. New Jersey: 0% Class A; 11% Class C; 15% Class D (charities exempt). Nebraska: 0% spouse/parent; 1-1% (immediate family); 11-15% (others). Kentucky: 0% spouse/lineal; 4-10% (Class B); 6-16% (Class C). Iowa (phasing out): 5-15% (Class B); 10-15% (Class C).
Beneficiary planning. For substantial gifts to non-Class-A relatives or friends, consider lifetime gifting before death (gift tax is federal only — no state gift tax in any state). Lifetime gifts may face federal gift tax but avoid state inheritance tax entirely.
U.S. states with inheritance tax (2025)
Reference U.S. state inheritance tax rates by state.
| State | Class A (spouse/lineal) | Class B (siblings, etc.) | Class C (other/unrelated) |
|---|---|---|---|
| Iowa (repealed — no tax for deaths after Jan 1, 2025) | No tax | No tax | No tax |
| Kentucky | Exempt (parents) | 4-16% | 6-16% |
| Maryland | Exempt | 10% | 10% |
| Nebraska | Exempt | 1% | 11-15% |
| New Jersey | Exempt | Variable (siblings classes) | 11-16% |
| Pennsylvania | 0% spouse, 4.5% lineal | 12% siblings | 15% other |
Iowa fully repealed its inheritance tax for deaths on or after January 1, 2025, leaving five states with an inheritance tax (KY, MD, NE, NJ, PA). Federal: NO inheritance tax — inheritance tax is levied only at the state level.
Frequently Asked Questions
What is the difference between inheritance tax and estate tax?
Estate tax is paid by the estate before assets are distributed. Inheritance tax is paid by the recipient after receiving the bequest. The US federal level uses estate tax; some states and many countries use inheritance tax.
Which US states have inheritance tax?
As of 2024 — Iowa (repealed for 2025+), Kentucky, Maryland, Nebraska, and Pennsylvania. New Jersey eliminated its inheritance tax in 2018 for most recipients. Each has its own rates and exemption rules.
Are spouses exempt from inheritance tax?
Almost always yes. Most jurisdictions exempt surviving spouses from inheritance tax entirely. Some also exempt direct descendants or charitable bequests.
How do rates vary by relationship?
Closer relatives pay less. Common structure: spouses 0%, children 0% to 10%, siblings 5% to 15%, unrelated heirs 10% to 30%. Specific brackets vary by jurisdiction; check local rules.
Is the inheritance itself taxable income to the heir?
In the US, no — inheritances are not subject to federal income tax. Any subsequent income (interest, dividends, capital gains on inherited assets) is taxable. State inheritance tax is separate from income tax.
When is this calculator unreliable?
When applying inheritance tax in states without it (44 states have NO inheritance tax). Federal also has no inheritance tax. Also unreliable when not accounting for Iowa phase-out (no inheritance tax 2025+). For states with inheritance tax, exact rates depend on amount inherited and heir's relationship — substantial planning opportunities for non-spouse beneficiaries.
References & Authoritative Sources
- Internal Revenue Service (IRS) — Estate and Gift Tax Information · consulted June 1, 2026 · Federal regulator on estate-related taxes
- Tax Foundation — State Inheritance and Estate Taxes · consulted June 1, 2026 · Authoritative state-level inheritance tax research
- American College of Trust and Estate Counsel (ACTEC) — State Estate Planning Resources · consulted June 1, 2026 · Professional estate planning resources
Related Calculators
Data Sources & Benchmarks
This calculator draws on 1 independent, dated source.
Methodology & Review
Inheritance tax is paid by the heir on assets received from a deceased person. The calculator returns inheritance tax due. Distinct from estate tax (paid by estate before distribution). U.S. federal: no inheritance tax. State inheritance tax in five states: Kentucky, Maryland, Nebraska, New Jersey, and Pennsylvania (Iowa repealed its inheritance tax effective January 1, 2025). Tax rates and exemptions vary by relationship (closer relatives typically pay less). Spouses universally exempt; lineal descendants (children) often exempt or low rate. RELIABILITY: Reliable for documented state and relationship. Less reliable when (a) state law changes (Iowa phasing out inheritance tax 2021-2025; PA various reforms); (b) relationship classification affects rates substantially; (c) certain assets (retirement accounts, life insurance) have separate rules.
Updated