Estate Taxes

There are two types of estate tax that may affect residents of Oregon.  The first is federal estate tax.  However, there is an exemption from federal estate tax of over $11.7 million as of 2021.  So, federal estate tax applies to few people.

Oregon estate tax is much more of a concern because the Oregon estate tax exemption is only $1 million as of 2021.  The tax rate on estates of over $1 million starts at 10% and goes up to 16%.  For example, if you die and there is $1.5 million in your estate, the Oregon estate tax is $50,000; but if your estate is valued at $4.5 million, the Oregon estate tax is $367,500.

If a person transfers property to his or her spouse at death, there is no estate tax at that time because of the "marital deduction".  But there may be an estate tax when the surviving spouse dies.  The marital deduction is only available if the surviving spouse is a U.S. Citizen.

Estate tax can be reduced by using tax planning documents that double the federal and state estate tax exemptions.  This means that a married couple in Oregon can protect up to $2 million of assets from state estate tax and up to $23.4 million from federal estate tax through estate tax planning.  Such tax planning is only available while both spouses are alive.

Other states have higher estate tax exemptions than Oregon or no estate tax at all.