There is an estate tax on the federal level, and it can significantly impact your legacy because it carries a 40 percent maximum rate. That’s the bad news, but the good news is that most people don’t pay the tax.
You can use the estate tax exclusion or credit to transfer a certain amount tax-free before the tax would be imposed on the remainder. The amount of the exclusion was changed after a tax act was passed at the end of 2017, and it became a reality the following year.
At that time, the exclusion was $11.18 million, and there have been relatively modest annual adjustments since then to account for inflation. This is the way it will stand unless the exclusions change via legislative mandate at some point in the future.