The 2026 Federal Estate Tax Exemption and Pennsylvania Inheritance Tax
For 2026, the federal estate and gift tax basic exclusion amount is $15 million per individual. Pennsylvania inheritance tax is a separate system. An estate can owe Pennsylvania inheritance tax even when no federal estate tax is due.
What changed at the federal level?
The 2026 federal basic exclusion increased from $13.99 million in 2025 to $15 million. Older planning articles warning that the exclusion would automatically drop sharply in 2026 do not reflect the law enacted in July 2025.
The federal calculation considers more than the assets passing under a will. Lifetime taxable gifts and the applicable estate tax rules matter. Families with substantial assets should review the full picture with their advisers rather than compare a single account balance with the exclusion.
Is the married-couple amount automatically $30 million?
No. Although two individuals may each have a $15 million basic exclusion, using a deceased spouse’s unused exclusion can require a portability election on a federal estate tax return. That return may be important even when an estate does not otherwise owe federal estate tax. Filing requirements, deadlines, prior gifts, and the estate plan should be reviewed individually.
Pennsylvania inheritance tax still needs attention
Pennsylvania generally applies inheritance tax rates based on the recipient’s relationship to the decedent. Common rates are 0% for transfers to a surviving spouse, 4.5% for lineal heirs, 12% for siblings, and 15% for other heirs. Additional exemptions and special rules apply, so these percentages are a starting point rather than a complete calculation.
The federal exclusion does not create a matching Pennsylvania inheritance tax exemption. Pennsylvania also offers a discount for qualifying tax payments made within three months of death; families should obtain advice promptly rather than wait until estate administration is nearly finished.
Review the plan beyond taxes
Confirm that wills, trusts, and beneficiary designations still reflect your wishes.
Review ownership of real estate, business interests, retirement accounts, and insurance.
Check the people named to handle finances, healthcare decisions, and estate administration.
Ask whether changes in family circumstances call for updated documents.
Sources: IRS Form 706 instructions; IRS gift tax guidance; Pennsylvania inheritance tax.
Contact Jacobs, Wilson & Onofry to discuss how these issues apply to your circumstances.
Sources checked October 1, 2026. This article provides general information, not legal or tax advice. Rules and individual circumstances can change the result.