The federal estate tax applies to assets transferred at death above the exemption amount. In 2026, the basic exclusion amount is $15M per person under current federal law. Assets below the exemption generally transfer free of federal estate tax and receive a step-up in cost basis.
The federal estate tax applies to assets transferred at death above the exemption amount. In 2026, the basic exclusion amount is $15M per person under current federal law. Assets below the exemption generally transfer free of federal estate tax and receive a step-up in cost basis.
Fewer than 0.1% of estates owe federal estate tax — but the step-up in basis affects everyone. For most retirees, the biggest estate-planning decision isn't taxes, it's beneficiary designations and whether to use trusts to simplify inheritance and protect assets.
The step-up in basis at death means appreciated stock inherited by a beneficiary resets to fair market value on the date of death — potentially saving six figures in capital gains tax. This is why "never sell your most appreciated shares" is common retirement advice.
Start with the free Retirement Readiness Score to see where you stand, then talk to a fiduciary if you want a second set of eyes. No pitch, no pressure.
Take the free assessment