Texas Estate and Inheritance Tax: What You Owe (2026)

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Here is the reassuring headline for almost everyone: Texas does not tax inheritances or estates at the state level. There is no Texas estate tax and no Texas inheritance tax. The only death tax that can ever apply to a Texas estate is the federal estate tax, and it reaches only a tiny fraction of estates because the exemption is so high.

This guide lays out precisely what a Texan does and does not owe when someone dies, and where the real (federal) line sits in 2026.

The short version
  • Texas state estate tax: none.
  • Texas state inheritance tax: none.
  • Federal estate tax: applies only above $15,000,000 per person in 2026, at a top rate of 40 percent.1
  • Inherited money is generally not taxable income to the person who receives it.

Texas has no estate or inheritance tax

An estate tax is charged on the estate itself before assets are distributed. An inheritance tax is charged on the person who receives an inheritance. Texas imposes neither.2 Texas once had a "pick-up" estate tax that was tied to a federal credit, but that credit was phased out under federal law, and Texas collects no death tax today. It does not matter whether you inherit a house in Houston, a ranch outside San Antonio, or a brokerage account in Dallas: the state of Texas takes no death-tax cut.

The federal estate tax is the only one that can apply

The federal estate tax is a national tax on the transfer of very large estates. What keeps it from touching ordinary families is the size of the exemption, formally the basic exclusion amount. For people who die in 2026, the federal exemption is $15,000,000 per person, up from $13.99 million in 2025. This higher amount was made permanent by the 2025 federal tax law and will be adjusted for inflation in future years. The top federal estate tax rate on amounts above the exemption is 40 percent.1

In plain terms, only the portion of an estate above $15 million is potentially taxed, and only the largest estates ever reach that ceiling. The vast majority of Texas estates owe no federal estate tax at all.

Married couples can shelter twice as much

Two features stack in a married couple's favor. First, the unlimited marital deduction lets you leave any amount to a U.S. citizen spouse free of federal estate tax. Second, portability lets a surviving spouse add the deceased spouse's unused exemption to their own, so a couple can shelter up to $30,000,000 in 2026 with proper planning.1 Claiming portability requires filing a federal estate tax return for the first spouse to die, even when no tax is owed, so this is one situation where a filing can be worth it purely to preserve the exemption.

Is an inheritance taxable income?

Generally, no. Money or property you inherit is not treated as taxable income on your federal return.3 There are a few things to keep in mind after you inherit:

  • Income the assets earn later (interest, dividends, rent) is taxable to you going forward, as with any asset you own.
  • Inherited retirement accounts such as a traditional IRA or 401(k) carry their own income-tax and withdrawal rules when you take distributions.
  • Capital gains on inherited property usually benefit from a "stepped-up basis," meaning gain is measured from the value at the date of death rather than what the deceased originally paid, which often reduces or erases the taxable gain if you sell soon after.
No state death tax does not mean no planning. Even in tax-friendly Texas, a will still decides who inherits, community property rules still shape what you can give, and probate still has to happen. Skipping a will does not save tax; it just hands the decisions to the state's intestacy formula. See dying without a will in Texas for what that default looks like.

The takeaway for Texas families

For nearly every Texan, death taxes are simply not part of the picture: Texas charges none, and the federal estate tax only affects estates in the eight-figure range. That means your estate planning can focus on the things that actually matter for a typical family, deciding who inherits, naming an executor and a guardian for children, and keeping the process smooth, rather than on tax avoidance. To put those decisions in writing, start with how to write a will in Texas, then create your Texas will here.

Sources

  1. 1IRS, Tax Inflation Adjustments for Tax Year 2026 (estate exemption $15,000,000) (irs.gov)
  2. 2Texas Comptroller of Public Accounts, Inheritance Tax (comptroller.texas.gov)
  3. 3IRS, Gifts and Inheritances (is an inheritance taxable) (irs.gov)

Frequently Asked Questions

Does Texas have an inheritance tax? No. Texas has neither a state inheritance tax nor a state estate tax.

What is the federal estate tax exemption in 2026? $15,000,000 per person, with a top rate of 40 percent on amounts above that. Married couples can shelter up to $30,000,000 using portability.

Do I pay income tax on money I inherit in Texas? Generally no. An inheritance is not taxable income, though income the assets later earn is taxable, and inherited retirement accounts have their own rules.

If Texas has no death tax, do I still need estate planning? Yes. A will decides who inherits, names an executor and guardian, and avoids the state intestacy formula. Tax is only one small part of planning.

Max Kuch

About the author

Max Kuch

Max Kuch writes about estate planning, wills and inheritance for Texas Will Template. He gathers the rules from the Texas statutes and the leading public data, then explains them in plain, accessible language so anyone can put their wishes in writing.

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Frequently asked questions

Yes, provided you finish it the right way. Under Tex. Est. Code Sec. 251.051 and 251.052, a holographic will is valid when it is written wholly in your own handwriting and signed by you. No witnesses are required and no date is required. What we hand you is a clean, correctly structured draft. It becomes a legally valid holographic will the moment you copy the whole thing out by hand on paper and sign it yourself.

Because Texas recognizes two separate paths, and printing points you toward the harder one. A typed or printed will has to be signed in front of two credible witnesses to be valid. A holographic will skips the witnesses entirely, but only if it is written completely in your own handwriting. If you print our draft and sign it alone, it is neither a valid witnessed will nor a valid holographic will. Copying the full text by hand is what makes the witness-free route work, so the handwriting is not a formality, it is the whole point.

Texas gives you unusually wide freedom here. There is no forced heirship and no elective share, so you are not required to leave a fixed portion to your spouse or to your children, and you can disinherit an adult child if you choose. One thing you cannot give away, though, is property that is not fully yours. Texas is a community property state, which means your surviving spouse already owns one half of everything the two of you acquired during the marriage. Your will can only dispose of your own half of the community property plus your separate property, so name what is genuinely yours to give.

Keep the signed original somewhere safe and dry, and make sure the person you named as executor knows exactly where it is, because a copy is far weaker than the original if the will ever has to be probated. If you want extra security, the clerk of the county where you live can hold your will for safekeeping during your lifetime under Tex. Est. Code Sec. 252.001, whether you are in Houston, Dallas, Austin, San Antonio or anywhere else in the state. Texas has no statewide will registry, so there is no central database to file it in.

We strongly recommend against a single shared document. A holographic will has to be wholly in one person's handwriting, so two people physically cannot create one valid handwritten will together. Beyond that, joint wills tend to lock the survivor into terms that are painful to change after the first death. The clean solution is two separate mirror wills, one in each spouse's own handwriting, each signed by that spouse. You can make them say almost the same thing while keeping each one independently valid and freely revocable.

Yes, and it is easy. A Texas will has no expiration, but life does not stand still, so revisit it after a marriage, a divorce, a birth, a death or a move. The safest way to make a change is to handwrite and sign a brand new holographic will that revokes all previous wills, then destroy the old signed original so no stale version can surface later. Avoid scribbling edits in the margins of a finished will, since alterations can raise doubt about what you actually intended.

No, and we do not pretend it does. This service gives you a solid, well-organized draft for a straightforward estate, which covers a great many Texas families perfectly well. But if your situation is complex, for example a blended family, a business, property in more than one state, a beneficiary with special needs or a plan that involves a trust, you should have a Texas estate attorney review it. Think of this as a strong, affordable starting point, not as legal advice.

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