How Are Estate Taxes Handled?

If you are settling a loved one's estate in Snohomish County, or planning your own, one worry tends to surface early: will the government take a large share before anything reaches the family? Understanding how estate taxes actually work in Washington often brings more relief than dread, because most estates never owe a dime.

Washington Has Its Own Estate Tax, Separate From the Federal One

The first thing families are surprised to learn is that Washington imposes its own estate tax, entirely separate from the federal estate tax. The state tax is governed by chapter 83.100 RCW. That means an estate could potentially face two different sets of rules: the federal estate tax administered by the IRS, and the Washington estate tax administered by the state Department of Revenue. The two systems have different thresholds, so it is possible to owe one and not the other.

An estate tax is a tax on the value of what a person leaves behind, calculated on the estate as a whole before assets are distributed. It is measured against the total value of the estate, called the gross estate, with certain deductions applied. The tax is paid out of the estate itself, not billed directly to the individual heirs, which is an important distinction we will return to below.

How the Washington Exclusion Amount Works

Washington applies an exclusion before calculating the taxable estate. The filing threshold and the amount ultimately subject to tax are related but different questions: deductions may eliminate tax even when a return is required. Tax filings and payment should be addressed before the estate is closed.

For deaths from January 1 through June 30, 2026, Washington's exclusion is $3,076,000. For deaths on or after July 1, 2026, it is $3,000,000. RCW 83.100.020 reflects the 2026 rollback; inflation adjustments resume in 2027 under the statutory formula. The date of death controls, not the date the estate is opened or the return is filed. Confirm the applicable amount with the Washington Department of Revenue.

The federal estate and gift tax basic exclusion is $15,000,000 for 2026, according to the IRS estate-tax filing thresholds. Prior taxable gifts and other filing rules also matter. A family may therefore have a Washington filing obligation even when no federal estate tax is due.

No Washington Inheritance Tax and No State Gift Tax

Two more points bring welcome clarity. Washington does not have an inheritance tax. That distinction matters because people often use the terms interchangeably, but they are not the same thing. An estate tax is charged to the estate before distribution, while an inheritance tax is charged to the individual beneficiaries based on what each one receives. Some states impose an inheritance tax on heirs; Washington does not. So a beneficiary in Washington does not owe a state inheritance tax simply for receiving a bequest.

Washington also has no state gift tax. Unlike the federal system, which coordinates gift and estate taxes and can count large lifetime gifts against your exclusion, Washington does not impose a separate state-level tax on gifts you make during your lifetime. That said, the federal gift tax rules still exist and can interact with federal estate tax planning, so significant lifetime gifting should always be reviewed with the federal framework in mind.

Why Planning Still Matters Even Below the Threshold

Because the Washington exclusion is generous and most estates fall under it, many families conclude they need no planning at all. That is often a mistake. Even when no estate tax is owed, thoughtful planning helps in other ways: it can streamline probate, protect a surviving spouse, preserve assets for children, and avoid disputes among heirs. For families whose estates are near or above the threshold, particularly those who own a home, a business, or land in a high-value market, planning tools can make a meaningful difference in how much reaches the next generation.

Married couples in particular have options worth exploring. Careful structuring can allow a couple to make full use of the available exclusions rather than wasting part of it, and these strategies overlap naturally with family and estate planning goals. In Snohomish County, where property values have climbed considerably, more estates edge toward the taxable range than families expect, which makes an accurate, current valuation and a clear plan all the more valuable. Property outside Washington may also raise ancillary probate questions.

Getting an Accurate Picture

Estate taxes in Washington are more manageable than most people fear, but the details matter, especially the current exclusion amount and the difference between estate, inheritance, and gift taxes. The safest approach is to confirm the figures that apply to the specific date of death rather than relying on numbers that may be out of date.