State estate & inheritance tax by state — plus the residency-establishment checklist

The 50-State Snapshot

States with estate or inheritance tax at the state level (2026)

The 2026 federal estate tax exemption is $15 million per individual (approximately $30 million for a married couple with proper portability elections) following the One Big Beautiful Bill Act. State-level exemptions and rates operate independently of the federal number, and in many cases the state exemption is materially lower than the federal — creating estate tax exposure at the state level for families whose federal exposure is zero.

States with an estate tax (imposed on the estate)

State	Exemption	Top Rate	Structure	Notes
Connecticut	$15.00M	12% flat	Federal-linked exemption (moves with federal); flat rate above threshold	Post-OBBBA Connecticut exemption tracks the $15M federal number. Anchor state in the WSJ August 2026 CT/FL domicile dispute.
District of Columbia	$4.87M	16%	Graduated (0.8%–16%)	State-set exemption, indexed annually — not federal-linked
Hawaii	$5.49M	20%	Graduated (10%–20%)	One of the two highest top rates in the country
Illinois	$4.00M	16%	Graduated (0.8%–16%)	Cliff considerations for estates near the threshold
Maine	$6.80M	12%	Graduated (8%–12%)	Independent state cap with annual inflation adjustment — does not automatically track federal OBBBA changes
Maryland	$5.00M	16%	Graduated (0.8%–16%)	Only state with both estate and inheritance tax
Massachusetts	$2.00M	16%	Graduated (0.8%–16%) — cliff above threshold	Cliff effect: estates just over $2M face tax on entire estate, not just excess
Minnesota	$3.00M	16%	Graduated (13%–16%)	Includes three-year lookback on gifts
New York	$6.94M	16%	Graduated (3.06%–16%) — cliff at ~105% of exemption	Notorious cliff: estates over 105% of exemption lose exemption entirely
Oregon	$1.00M	16%	Graduated (10%–16%)	Lowest exemption in the country — many families exposed
Rhode Island	$1.78M	16%	Graduated (0.8%–16%)	Indexed to inflation; verify current-year threshold
Vermont	$5.00M	16% flat	Flat rate above threshold	Straightforward flat structure
Washington	$2.19M	35%	Graduated (10%–35%)	Top rate increased in 2025 legislation — highest in the country

Exemption amounts and rates are as of 2026 based on then-current state statutes. Several states index exemptions annually. Connecticut's exemption is expressly tied to the federal exemption — post-OBBBA the CT threshold is $15M, moving with any subsequent federal change. Maine and DC have independent state-set exemptions with annual inflation adjustments and do not automatically track federal changes. The advisor should verify the current-year threshold and rate schedule for any specific engagement.

States with an inheritance tax (imposed on the beneficiary)

Inheritance tax is levied on the recipient, not the estate. Rates typically vary by the beneficiary's relationship to the decedent — spouses and lineal descendants often exempt, siblings/nephews/nieces at intermediate rates, unrelated beneficiaries at the highest rates.

State	Rate Range	Structure	Notes
Kentucky	0%–16%	By beneficiary class (Class A/B/C)	Class A (spouses, children, parents) exempt; Class C (unrelated) at highest rates
Maryland	0%–10%	By beneficiary class	Non-lineal at 10%; also has state estate tax
Nebraska	1%–15%	By beneficiary class	Immediate family at low rates; unrelated at 15%
New Jersey	11%–16%	Non-lineal beneficiaries only	Spouses, children, parents exempt; siblings and non-relatives taxed
Pennsylvania	0%–15%	By beneficiary class	Spouses 0%; lineal descendants 4.5%; siblings 12%; other 15%

Iowa's inheritance tax was fully repealed effective 2025. Practitioners with older reference material should confirm current status of the tax in each jurisdiction — several states have modified or repealed inheritance taxes in recent years.

The Escape Set

States with no estate tax or inheritance tax

These 32 states impose neither an estate tax nor an inheritance tax at the state level. High-net-worth families in high-tax-exposure states frequently evaluate a change of domicile to one of these jurisdictions, particularly the six no-income-tax states (Florida, Texas, Nevada, Tennessee, Wyoming, South Dakota — plus Washington and New Hampshire on limited income) that combine estate-tax neutrality with income-tax neutrality.

State	State Income Tax	Practitioner Note
Florida	None	Most common destination for CT, NY, MA, NJ, IL migrations. Homestead exemption is a well-defined domicile marker.
Texas	None	Second most common destination. No estate, no income; homestead protections strong.
Nevada	None	No income tax; asset protection trust jurisdiction adds value beyond estate.
Wyoming	None	Dynasty trust and asset protection jurisdiction; small population makes residency more scrutinized.
Tennessee	None (Hall Tax repealed 2021)	No estate, no income; asset protection trust available.
South Dakota	None	Dynasty trust jurisdiction of choice for many advisors; asset protection trust rules highly favorable.
Alaska	None	No estate, no income; APT jurisdiction; geographic friction limits practical use.
New Hampshire	Limited (interest/dividends only, phased out 2027)	No estate, no wage income tax.
Other no-estate-tax states	Various	Arizona, Arkansas, California, Colorado, Delaware, Georgia, Idaho, Indiana, Kansas, Louisiana, Michigan, Mississippi, Missouri, Montana, New Mexico, North Carolina, North Dakota, Ohio, Oklahoma, South Carolina, Utah, Virginia, West Virginia, Wisconsin — all have state income tax but no estate/inheritance tax

The Residency-Establishment Checklist

What actually establishes a change of domicile

Changing state of residency for tax purposes is not a single action. Origin states, particularly aggressive collectors like New York, California, Connecticut, Massachusetts, and Illinois, apply multi-factor tests to determine whether a claimed change of domicile is real or a paper exercise. A defensible domicile change generally requires a preponderance of actions across roughly two dozen categories, ideally accomplished in the calendar year of the claimed change with contemporaneous documentation. The checklist below reflects the modal advisor's protocol for a client changing residency from a high-tax to a no-estate-tax state.

Physical presence and time-in-state

• Spend more than 183 days per year in the new state. The 183-day rule is not literally the test in most jurisdictions but is the practical baseline. Document with contemporaneous calendar records, credit card receipts, cell tower data, and airline records.
• Spend less than 183 days per year in the origin state. The affirmative half of the same rule. Advisors typically target under 120 days in the origin state as a comfortable buffer.
• Maintain a residence in the new state that is your primary home. Not a vacation property. Furnished, permanently occupied, primary address for mail and delivery.
• If retaining a residence in the origin state, downgrade it. Sell if possible; if retained, convert to a smaller/less-primary property, rent it out for part of the year, or convert to family-member use.

Official identification and government registrations

• Obtain a driver's license or state ID in the new state; surrender the origin state license. Most defensible when done within 30-60 days of the move.
• Register vehicles in the new state. Transfer plates, registration, and insurance.
• Register to vote in the new state; cancel origin state voter registration. Vote in the new state at the next available election.
• File a Declaration of Domicile (or state-specific equivalent — Florida uses Form DR-501 for homestead; other states have separate domicile filings).
• Claim the homestead exemption in the new state where applicable. Florida's homestead exemption is the strongest domicile marker in the country and provides substantial creditor protection as an added benefit.

Tax filings and financial architecture

• File a part-year resident return in both states for the year of the move. The final full-year resident return in the origin state and the first full-year resident return in the new state anchor the transition.
• Notify the IRS of the new address (Form 8822). Federal returns should use the new address from the date of the move forward.
• Update W-2 / 1099 addresses with all payers. Employers, brokerages, retirement account custodians, K-1 issuers.
• Move primary banking to the new state. Open primary checking, savings, and safety deposit box relationships with a bank branch in the new state.
• Move brokerage accounts to reflect the new state address. Even if the custodian is national, the address of record matters.
• Update estate planning documents. Will, revocable trust, health care proxies, powers of attorney should be re-executed under the new state's law, referencing the new domicile.

Professional and family ties

• Change primary physicians, dentists, and other health care providers to the new state.
• Retain a local CPA, estate attorney, and other professional advisors in the new state. Retaining the origin state advisors is a red flag; either move relationships or add new-state counterparts.
• Change primary religious affiliation, civic organizations, and club memberships. Actively join organizations in the new state; resign or downgrade from origin state.
• Move safety deposit box, family heirlooms, and personal property. The physical location of items that "matter to you personally" is examined in domicile audits.
• Enroll dependent children in schools in the new state. Origin state school enrollment is nearly fatal to a domicile claim.

Business and professional ties

• If retaining an ownership interest in an origin-state business, minimize physical presence at the business. Manage remotely; hold board meetings in the new state; document business travel to origin state.
• Update professional licenses and industry registrations where the license is state-specific.
• Change email signature block, business cards, and letterhead to reflect the new state address.
• Move any solo consultancy or LLC to the new state — form a new-state LLC or file for authority to conduct business there.

Documentation and paper trail

• Maintain a contemporaneous domicile-transition file. Everything above should be documented in a single file the client (or the advisor on the client's behalf) can produce if the origin state auditor asks.
• Keep travel records for at least 4 years post-move. Calendar, receipts, cell records, EZ-Pass records — all support the physical-presence half of the test.
• Preserve utility bills, credit card statements, and lease documents showing continuous residence in the new state.
• Avoid inconsistencies. Origin-state credit card address, origin-state doctor visit, origin-state country club use, or origin-state real estate use immediately after the move are all documented and used against the claim in an audit.

This checklist is intentionally comprehensive. The advisor's judgment on which items are essential vs. supplementary depends on the origin state's audit posture, the size of the estate, and the specific facts of the client's ongoing ties. For an aggressive origin state (New York, California) with a large estate, treat the entire checklist as required. For a less aggressive origin state and a smaller estate, some items may be practical to defer. When in doubt, complete the full checklist.

Companion Institute References

Deeper practitioner mechanics on the topics touched above