Oregon Estate Tax Calculator 2026 — $1M Exemption, Cliff Effect
Calculate Oregon estate tax for 2026. $1M exemption (one of the lowest), 10%–16% rates, cliff effect at threshold. Includes planning strategies: life insurance, gifting, ILIT.
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Total value of all assets at death $
Mortgages, loans, funeral, admin costs $
Assets passing to US citizen spouse (unlimited, but deferred) $
Bequests to qualified charities $0
OR Estate Tax
$0
Federal Estate Tax
0%
OR Effective Rate
$0
Net to Heirs
Oregon Estate Tax Calculation
How Oregon Estate Tax Works
Oregon imposes estate tax on estates exceeding $1,000,000. Every dollar above the $1M threshold is subject to Oregon estate tax at progressive rates starting at 10%. There is no portability — each person has their own $1M exemption, and it cannot be transferred to a surviving spouse.
The Cliff Effect
OR Taxable Estate = Gross Estate − Debts − Marital Deduction − Charitable
OR Tax = Progressive rates on amount above $1,000,000
Cliff: Estate of $1,000,001 → immediate 10% on $1 above threshold
Estate of $1.1M → ~$10,000 OR estate tax (10% of $100K above $1M)
OR Tax = Progressive rates on amount above $1,000,000
Cliff: Estate of $1,000,001 → immediate 10% on $1 above threshold
Estate of $1.1M → ~$10,000 OR estate tax (10% of $100K above $1M)
Example
Estate of $2,000,000 with $50,000 debts:
OR taxable estate: $1,950,000
Amount above $1M exemption: $950,000
OR estate tax: ~$96,250 (10% on first $500K + 10.25% on next $450K)
Federal estate tax: $0 (well below $13.61M federal exemption)
Net to heirs: ~$1,853,750
OR taxable estate: $1,950,000
Amount above $1M exemption: $950,000
OR estate tax: ~$96,250 (10% on first $500K + 10.25% on next $450K)
Federal estate tax: $0 (well below $13.61M federal exemption)
Net to heirs: ~$1,853,750
Extended
Cliff Effect & OR Planning Strategies
Visualize the cliff effect at $1M and compare ILIT, gifting, and trust strategies to reduce your Oregon estate tax
See how the Oregon estate tax cliff effect hits estates just above $1M, and compare planning strategies that can reduce or eliminate the tax.
Cliff Effect Demonstration — Estates Near $1M
| Estate Value | Above Exemption | OR Tax | Effective Rate on Excess |
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Planning Strategies to Reduce Oregon Estate Tax
| Strategy | How It Works | Est. Annual Reduction | 10-Year Tax Savings |
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OR Note: Oregon's $1M exemption has not been indexed for inflation since 2012. A modest house plus retirement savings can easily push an Oregon estate above $1M. Unlike federal estate tax, there is no inflation adjustment — making planning especially important for Oregon residents.
Frequently Asked Questions
What is the Oregon estate tax exemption for 2026?
Oregon's estate tax exemption is $1,000,000 per person — one of the lowest state estate tax exemptions in the country. There is no portability in Oregon, meaning each person's $1M exemption is use-it-or-lose-it. A married couple cannot combine exemptions without a Credit Shelter Trust.
What is the Oregon estate tax "cliff effect"?
Oregon's estate tax has a well-known cliff effect. If an estate is worth $1,000,001 — just $1 above the exemption — the entire excess triggers the estate tax. There is no gradual phase-in. The tax on a $1,000,001 estate starts immediately at 10% on the $1 above the exemption. More critically, for estates just slightly above $1M, the tax can consume a disproportionate share. An estate of $1.1M might owe $10,000 in Oregon estate tax, making the effective rate on that extra $100,000 around 10%.
What are Oregon estate tax rates?
Oregon uses a progressive rate schedule: 10% on the first $1M above the exemption, rising to 16% on amounts over $9.5M above the exemption. The full schedule is: 10%, 10.25%, 10.5%, 11%, 11.5%, 12%, 13%, 14%, 15%, and 16%.
Can I reduce Oregon estate tax with planning strategies?
Yes. Key strategies include: (1) Irrevocable Life Insurance Trust (ILIT) — removes life insurance from the taxable estate; (2) Annual gifting — $18,000 per recipient per year reduces the estate; (3) Credit Shelter Trust for married couples — preserves both spouses' $1M exemptions; (4) Charitable giving — reduces the taxable estate directly; (5) Grantor Retained Annuity Trust (GRAT) — freezes estate value for growing assets. Oregon residents with estates between $1M and $14M face Oregon tax with no federal offset.
Do non-residents owe Oregon estate tax?
Non-Oregon residents may owe Oregon estate tax on Oregon-sited real property or tangible personal property located in Oregon. The Oregon estate tax would be prorated based on the ratio of Oregon property to total estate value. Residents of Oregon owe tax on their worldwide assets above the $1M exemption.