The top estate tax rate for 2017 is 40% and there is a $5,490,000 exemption amount. Individuals can transfer up to $5,490,000 (indexed for inflation in the future) to heirs free from estate tax.
In addition, for married couples, if one spouse dies without using the full exclusion, the remainder can be added to the surviving spouse's own exclusion. This provision provides a way for couples to take advantage of each other’s exemption, without having to create complicated trusts or wills. Since widows and widowers can add any unused exclusion of the spouse who died to their own, they can effectively, together as a couple, transfer up to $10.98 million tax-free.
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