In addition to the federal estate tax of 40 percent, some states impose an additional estate or inheritance tax. Twelve states and the District of Columbia impose an estate tax while six states have an inheritance tax. Maryland is the only state in the country to impose both. Washington state’s 20 percent rate is the highest estate tax rate in the nation; eight states and DC are next with a top rate of 16 percent. Three states match the federal exemption level of $11.2 million.
Of the six states with inheritance taxes, Nebraska has the highest top rate at 18 percent. Maryland imposes the lowest top rate at 10 percent. All six states exempt spouses, and some fully or partially exempt immediate relatives.