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Taxation of Estates in Florida and Texas

By Nehemiah Jefferson, Esq., LL.M.

An estate is created when a person dies. The estate includes everything that the individual owned at death. 

In 2024, it seems like there is a tax for everything. There are income taxes, property taxes, sales taxes, transfer taxes, gift taxes, inheritance taxes, capital gains taxes, and yes, even taxes on estates, also known as “death taxes.”  If you were thinking like me, your first thought is, “wait a minute didn’t I pay taxes already?” Fortunately, if you live in the State of Florida or Texas, there is no estate tax (i.e. on the state level).  However, there is the federal estate tax.

Before money maybe passed on to a decedent’s heirs, a tax on the estate may apply, if a certain threshold is met.  For tax year 2024, the federal estate tax would be applicable to estates exceeding $13.61 million for an individual and $27.22 million for a married couple estate.  The amount above the exemption ($13.61/$27.22 million) would be subject up to a top federal tax rate of 40%. This is one reason why estate planning is important and should be comprehensive.

Additionally, neither Florida nor Texas have a state income tax. Again, however, there is the federal income tax. Sometimes an estate can produce income through investments or rental property. If an estate produces income in excess of $600 per year, the estate may need to file Form 1041.

Of course this article is not all encompassing when it comes to the taxation of estates. For example, this article did not touch on other associated taxes such as the “inheritance tax” or “gift tax.” As with any legal matter, you should consult an Attorney. This article is for educational purposes only, is not legal advice, is not a substitute for consulting legal counsel, and does not create an attorney-client relationship.

Nehemiah Jefferson, Esq., LL.M., is Principal of Esquire Tax Firm PLLC. The firm practice areas include Civil and Criminal Tax Representation, Estate Planning, Probate, Guardianship, and Business Planning. He earned his Bachelor’s degree from The Florida State University, his Juris Doctor from John Marshall Law School (Atlanta), and LL.M. in Taxation from the University of Alabama. Attorney Jefferson is licensed to practice law in the State of Florida, Texas, The District of Columbia, and is a member of the United States Tax Court Bar. He may be reached at www.esqtaxfirm.com.