2026 Federal, Texas, and Washington State Estate Taxes

2026 Texas Inheritance Tax

For Texas readers: there is no state-based estate or inheritance tax. Your main concern, along with residents from other states, is the federal estate tax.

2026 Federal Estate Tax

In 2025 the exemption from federal estate tax was $13.99 million per individual citizen. There was a great deal of uncertainty in 2025, because the tax law which was passed in 2017 was set to expire at the end of 2025. If Congress could not agree on changes, the $13.99 million exemption was set to jump down to around $6m to $7m per individual citizen.

Congress did, however, pass a new law. In July 2025, Trump's One Big Beautiful Bill Act (OBBBA) increased the exemption amount to $15 million per citizen and eliminated the expiration date. The exemption will be adjusted for inflation starting in 2027, so anyone dying in 2026 is free from federal estate tax if their estate is valued below $15 million.

2026 Washington State Estate Tax

In 2025, the Washington Legislature made a variety of big changes to the state's Estate Tax. Here are the crucial details:

• Increased Base Exemption: The exemption amount, which refers to the portion of an estate not subject to state estate tax, was raised from $2.193 million to $3 million. Estates valued at or below this new threshold will no longer have to pay Washington estate tax or file a Washington estate tax return.

  
  

• Annual Inflation Adjustment: Although Washington law already provided for an annual inflation adjustment, technical wording issues hindered it before 2025. The Consumer Price Index (CPI) used to calculate the adjustment was out of date. The 2025 law change updated the references to a current CPI region so that, starting in 2026, the state could adjust the base exemption for inflation. But no one could predict the US federal government would be shut down for more than a month in late 2025 due to partisan bickering. The shut down caused a delay in updating the CPI. The Washington State Department of Revenue posted this notice on its website:

  
  

"Please note that due to the federal government shutdown during October 2025, the department is using the August 2025 CPI for the Seattle municipal area. If the U.S. Bureau of Labor Statistics issues an October 2025 CPI for the Seattle municipal area within the next year, we will update the 2026 filing threshold, exclusion amount, and maximum allowed QFOBI deduction accordingly."

Hence, the inflation adjustment to the Washington State exemption amount moved the $3 million exemption upward to only $3,076,000 for 2026. The state may recalculate if/when the federal Bureau of Labor Statistics issues new inflation numbers. See their website at https://dor.wa.gov/taxes-rates/other-taxes/estate-tax for updates.

• Higher Tax Rates for Large Estates: In 2025, the top marginal rate for estates valued over $9 million has increased from 20% to 35%. This rate remains the same in 2026 and makes Washington's estate tax some of the highest in the nation for larger estates. However, a $3 million deduction for qualified family-owned business interests has been introduced, which lessens the tax burden for certain business owners.

  
  

Why You Should Act Now

Washington residents with estates valued below $3,076,000 million will benefit from these new laws. Those with estates valued close to or exceeding $3,076,000 should review their estate plans carefully. With the increased rates on larger estates, it's crucial to ensure that your strategies align with these changes. Married Washingtonians with estates near or above $6 million, and un-Married Washingtonians with estates near or above $3 million should seek professional advice to reduce or eliminate the state's Estate Tax.

Legal Strategies to Reduce Estate Tax

There are several legal methods to reduce or eliminate estate tax obligations. Each strategy, however, comes with its advantages and disadvantages.

Federal law allows a married couple to double their exemption (that is, to consider the exemption of the first-to-die as "portable" to the estate of the second-to-die). No special trust planning is needed to use this federal portability of the federal exemption.

The opposite is true for the Washington State exemption. There is no "portability" of the Washington state exemption. Hence, married couples must utilize a bypass trust to effectively double the exemption amount, minimizing or eliminating tax liabilities.

If the value of your home, savings, retirement accounts, investments, or life insurance could potentially subject your estate to taxation, act now. Schedule a Zoom video consultation with Paul Premack to discuss and optimize your estate planning under the current tax laws. Visit our online scheduler at www.Premack.com.

The Importance of Estate Planning

Estate planning is a crucial and often overlooked aspect of financial well-being. It involves making decisions about how your assets will be distributed after your passing. Proper planning can help ensure that your loved ones are supported according to your wishes, and it can significantly minimize tax burdens.

To secure your financial legacy, start the estate planning process as soon as possible. Keep in mind the potential future changes in tax laws, both state and federal. This can help you stay ahead and safeguard your family’s future.

Paul Premack is a Certified Elder Law Attorney specializing in Wills and Trusts, Probate, and Elder Law issues. He is licensed to practice law in Texas and Washington. To contact us, visit www.Premack.com.

Column published on January 23, 2026.