Are State Estate Taxes Deductible on the Beneficiaries’ Income Tax Returns?

 In Estate and Gift Taxes

Question:

When my children will need to pay a Massachusetts estate tax after my death, will that deductible from their federal income taxes? I read somewhere that it is.

Photo by Wellesley Yan on Unsplash

Response:

No. State estate taxes are not deductible on income tax returns, just on federal estate tax returns. Unfortunately, this is irrelevant for almost everyone since the federal estate tax threshold currently (in 2019) is $11.4 million, meaning only estates above this amount pay any federal estate tax.

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