New York Estate Tax Rate Table: 3.06% to 16% and the Cliff

New York estate tax rates run from 3.06% to 16% on a 15-bracket graduated schedule, applied to the taxable estate of any resident who dies in 2026 with an estate above the $7,350,000 basic exclusion. Estates at or below that threshold owe nothing and don’t have to file. Estates that push past it face not just the graduated rates but a “cliff” that can eliminate the exclusion entirely once the estate exceeds 105% of the threshold.

The Full Rate Schedule

New York calculates the tax under Tax Law Section 952(b) using progressive brackets. Each rate applies only to the portion of the taxable estate falling within its range, and the total tax is the sum across tiers.¹

Up to $500,000: 3.06% of the taxable estate
$500,001 to $1,000,000: $15,300 plus 5.0% of the amount over $500,000
$1,000,001 to $1,500,000: $40,300 plus 5.5% of the amount over $1,000,000
$1,500,001 to $2,100,000: $67,800 plus 6.5% of the amount over $1,500,000
$2,100,001 to $2,600,000: $106,800 plus 8.0% of the amount over $2,100,000
$2,600,001 to $3,100,000: $146,800 plus 8.8% of the amount over $2,600,000
$3,100,001 to $3,600,000: $190,800 plus 9.6% of the amount over $3,100,000
$3,600,001 to $4,100,000: $238,800 plus 10.4% of the amount over $3,600,000
$4,100,001 to $5,100,000: $290,800 plus 11.2% of the amount over $4,100,000
$5,100,001 to $6,100,000: $402,800 plus 12.0% of the amount over $5,100,000
$6,100,001 to $7,100,000: $522,800 plus 12.8% of the amount over $6,100,000
$7,100,001 to $8,100,000: $650,800 plus 13.6% of the amount over $7,100,000
$8,100,001 to $9,100,000: $786,800 plus 14.4% of the amount over $8,100,000
$9,100,001 to $10,100,000: $930,800 plus 15.2% of the amount over $9,100,000
Over $10,100,000: $1,082,800 plus 16.0% of the amount over $10,100,000

Take a taxable estate of $8,500,000 to see how it works. The first $8,100,000 produces a base tax of $786,800. The remaining $400,000 is taxed at 14.4%, adding $57,600. The total tax is $844,400. Every dollar above $10,100,000 is taxed at the top rate of 16%, but dollars in lower brackets always stay at the lower rates no matter how large the overall estate.

The 2026 Basic Exclusion Amount

The basic exclusion is the value a New York resident can pass without owing any state estate tax. For 2026 deaths, it is $7,350,000.² At or below that figure, no tax is due and no return is required. The exclusion is set under Tax Law Section 952(c)(2) and adjusts each year with the Consumer Price Index, so executors should confirm the number that applies to the actual year of death rather than relying on a prior year’s figure.¹

New York’s exclusion is a separate system from the federal estate tax. An estate can owe New York tax without owing any federal tax, or the reverse. Filing requirements are independent.

The Cliff at 105% of the Exclusion

This is where New York’s system turns punitive. The state grants a credit that offsets the entire tax bill for estates at or below the exclusion. If the taxable estate exceeds 105% of the exclusion, that credit vanishes completely, and the graduated rates apply to the whole estate starting from dollar one.¹

For 2026, the cliff sits at $7,717,500.² An estate worth $7,350,000 owes nothing. An estate worth $7,720,000 loses the credit and faces a tax bill calculated on the full $7,720,000, which comes to roughly $670,000. A $370,000 increase in value created a six-figure tax from zero.

Between $7,350,000 and $7,717,500, the credit phases out on a sliding scale rather than disappearing at once. The statute reduces it by a fraction whose numerator is the excess over the exclusion and whose denominator is 5% of the exclusion. The credit shrinks fast across that narrow band. Past $7,717,500, no credit remains.¹

How the Taxable Estate Is Calculated

The taxable estate starts with the gross estate and subtracts the same deductions federal law allows, with one carve-out: deductions tied to real or tangible property located outside New York are excluded.³ The main deductions:

Transfers to a surviving U.S. citizen spouse are fully deductible, whether outright or through qualifying trusts.
Bequests to qualifying charities reduce the taxable estate dollar for dollar.
Legitimate debts owed by the decedent, including mortgages on New York property, come off the gross estate.
Funeral costs, executor commissions, attorney fees, and accounting fees are deductible. For indirect expenses such as attorney fees, New York may require allocation if the estate includes property in other states.

Because a well-timed deduction can pull an estate under the $7,350,000 line, and because the cliff makes that line so consequential, these deductions carry more weight in New York than in most states. A charitable bequest calibrated to bring the taxable estate back to the exclusion amount can restore the credit and drop the tax to zero.

Three-Year Gift Add-Back

Executors must add certain lifetime gifts back into the gross estate if they were made within three years of death. The rule targets last-minute transfers designed to shrink the estate below the exclusion.⁴

The add-back covers any gift that would have been reportable for federal gift tax purposes, with several exceptions. Gifts of real or tangible property located outside New York are excluded. So are gifts made while the decedent was not a New York resident, and gifts made before April 1, 2014. The value used is the fair market value at the time the gift was made, not its value at death.⁴

This is a common reason an estate that appeared to sit safely below the exclusion ends up above it, or above the cliff. A $500,000 gift to a child two years before death gets pulled back in. The statute provides that the add-back rule expires for deaths on or after January 1, 2032.⁴

No Portability Between Spouses

Federal law lets a surviving spouse claim the unused portion of the first spouse’s exemption. New York does not. The state exclusion belongs to each individual and cannot be transferred to a survivor. If the first spouse leaves everything to the survivor using the marital deduction, no tax is due at the first death, but the survivor’s estate now holds both spouses’ assets against only one $7,350,000 exclusion. The first spouse’s exclusion is effectively lost.

Non-Residents Who Own New York Property

You don’t have to live in New York to owe the tax. A non-resident who dies owning real property or tangible personal property in New York must file a New York return if the federal gross estate, plus includible gifts of New York-situs property, exceeds the basic exclusion.²

Tangible personal property means physical items like artwork, jewelry, or vehicles located in the state. Stocks, bank deposits, bonds, and other intangible assets generally don’t count as New York property for non-residents unless they’re used in a business carried on within the state. The tax is computed on the full estate and then prorated by the ratio of New York property to the total federal gross estate.

Filing Deadlines and Penalties

Form ET-706 and the tax payment are both due nine months after the date of death.⁵ Only estates whose gross estate plus includible gifts exceeds $7,350,000 have to file.²

An executor can apply for a six-month filing extension using Form ET-133, but the application must be filed before the original nine-month deadline. An extension to file does not extend the time to pay: the application must include the estimated tax and payment.⁶ If paying within nine months would cause undue hardship, the Department of Taxation and Finance can extend the payment deadline up to four years from the date of death.⁵

Missing the deadlines is costly. Late filing penalties run 5% of the tax due for each month the return is late, up to 25%. Late payment adds 0.5% per month, also capped at 25%. Interest compounds daily on any unpaid balance from the original due date, even if a filing extension was granted. Understating the tax by more than 10% or $2,000, whichever is greater, triggers an additional 10% penalty on the underpayment.⁷

1
New York State Senate. New York Tax Law TAX 952 – Tax Imposed
2
New York State Department of Taxation and Finance. Estate Tax
3
New York State Department of Taxation and Finance. Treatment of Certain Deductions for New York State Estate Tax
4
New York State Senate. New York Tax Law TAX 954 – Residents New York Gross Estate
5
New York State Department of Taxation and Finance. Instructions for Form ET-706 New York State Estate Tax Return
6
New York State Department of Taxation and Finance. Instructions for Form ET-133 Application for Extension of Time to File and/or Pay Estate Tax
7
New York State Department of Taxation and Finance. Interest and Penalties