death taxes

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“Death taxes” is a pejorative term used to refer to taxes imposed on an individual’s property after their death. There are two specific kinds of “death taxes:” estate taxes and inheritance taxes. An estate tax refers to a tax on a decedent’s estate prior to the transfer of property from the estate to a separate entity. An inheritance tax refers to a tax levied on property transferred to a specific entity from an estate. The threshold for the federal estate tax is set at $11.7 million until 2026. Currently, twelve states impose an estate tax in addition to that which exists at the federal level. There is no federal inheritance tax, and six states impose such a tax at the local level. 

[Last updated in July of 2021 by the Wex Definitions Team]