What is the Massachusetts estate tax exemption?

For deaths on or after January 1, 2023, the Massachusetts estate tax exemption is $2,000,000. If the gross estate (plus adjusted taxable gifts) is $2,000,000 or less, no Massachusetts estate tax is due and no return is required. If it exceeds $2,000,000, the estate must file Form M-706 and tax is computed on the value above the exemption.

How is the Massachusetts estate tax calculated?

Massachusetts uses the federal estate tax credit table that was in effect before 2001 (the IRS Form 706 graduated table). The tentative tax is computed on the full taxable estate using that table, and then the 2023 reform grants a credit of $99,600, which is the table tax on the first $2,000,000. The net result is that only value above $2,000,000 is effectively taxed, at marginal rates from roughly 0.8% up to 16%.

Is the estate tax a cliff tax in Massachusetts?

Before 2023 it was a true cliff: exceeding the threshold by $1 taxed the entire estate from the first dollar. The 2023 reform fixed this by introducing the $99,600 credit, so estates just over $2,000,000 now pay tax only on the excess. This calculator reflects the post-2023 credit method.

Does the marital deduction reduce Massachusetts estate tax?

Yes. Assets passing to a surviving spouse generally qualify for an unlimited marital deduction, and gifts to qualified charities are deductible. Entering these as deductions reduces the taxable estate. This tool lets you subtract total deductions before applying the rate table, but you should confirm eligibility with an estate attorney.

Is this calculator a substitute for filing Form M-706?

No. This is an estimate using the published Massachusetts rate table and exemption. The actual return (Form M-706) involves adjusted taxable gifts, real estate located outside Massachusetts, and other adjustments. Use this to gauge potential liability, then work with an estate professional to file.

Massachusetts Estate Tax Calculator

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Massachusetts is one of the few states that still imposes its own estate tax, separate from the federal estate tax. For deaths on or after January 1, 2023, the exemption is $2,000,000. Estates below that owe nothing; estates above it are taxed using the pre-2001 federal credit table, with a $99,600 credit that limits the tax to the value above the exemption. This calculator applies that exact method.

How it works

Massachusetts computes a tentative tax on the entire taxable estate using the old federal Form 706 graduated credit table, then subtracts a fixed credit equal to the table tax on the first $2,000,000:

taxable estate   = gross estate - deductions
tentative tax    = table(taxable estate)      // pre-2001 federal credit table
reform credit    = 99,600                      // = table(2,000,000)
MA estate tax    = max(0, tentative tax - reform credit)   // only if estate > 2,000,000

The graduated table starts at 0.8% on the first bracket above $40,000 and rises in steps to a top marginal rate of 16% on amounts over $10,040,000. Because the credit equals the table tax on $2,000,000, the net effect is that the first $2,000,000 is effectively exempt and only the excess is taxed.

Rate table brackets

The table is applied to the adjusted taxable estate. Each bracket has a base tax plus a marginal rate on the amount over the bracket floor. For example, an estate between $1,040,000 and $1,540,000 pays $38,800 plus 7% of the amount over $1,040,000. The top bracket taxes amounts over $10,040,000 at 16%.

Worked example

A taxable estate of $3,000,000:

Tentative table tax on $3,000,000 = $182,000
Reform credit = $99,600
Massachusetts estate tax = $182,000 - $99,600 = $82,400

Note: This is an estimate using the published Massachusetts exemption and rate table. The real Form M-706 includes adjusted taxable gifts and out-of-state real estate adjustments. Verify current rules at mass.gov/dor and consult an estate attorney before relying on these figures.