QPRT Calculator 2026 β Qualified Personal Residence Trust
Calculate estate tax savings from a QPRT using the March 2026 Section 7520 rate. Find the gift value, estate tax reduction, and optimal trust term length.
Longer term = smaller gift but higher mortality risk
March 2026 IRS rate: ~5.2%
Federal: 40% above $13.99M exemption (2026)
QPRT Calculation Details
| Item | Value |
|---|---|
| Current home FMV | $1,500,000 |
| Section 7520 rate | 5.2% |
| Trust term | 10 years |
| Retained interest (PV of right to live in home) | $813,000 |
| Gift value (remainder interest = FMV β retained) | $687,000 |
| Gift as % of FMV | 45.8% |
| Est. home value when term ends | $2,220,000 |
| Appreciation removed from estate | $1,533,000 |
| Estate tax saved (40% Γ removed appreciation) | $741,600 |
| Risk if death during term | Full FMV included in estate |
How a QPRT Works
A QPRT is an estate planning strategy that leverages the time value of money and IRS actuarial tables to transfer a residence to heirs at a substantially discounted gift tax value.
Gift Valuation Formula
Gift Value (Remainder) = FMV β Retained Interest
PV Factor = (1 β (1 + Β§7520)^βterm) / Β§7520
Estate Tax Savings Formula
Amount Removed from Estate = Future Value β Gift Value
Estate Tax Savings = Amount Removed Γ Estate Tax Rate (40%)
PV Factor = 7.619 β Retained Interest = $1.5M Γ (7.619 Γ 5.2%) β $594K
Gift = $1.5M β $594K = $906K (vs $1.5M without QPRT)
At 4% appreciation: home = $2.22M in 10 years β $1.22M of appreciation estate tax free
Optimal Term Analysis & Mortality Risk Table
See gift value and estate tax savings across all term lengths with survival probability
Optimal Term Length Analysis
Longer terms produce smaller taxable gifts but increase the risk of dying during the term. The table shows savings vs risk at different term lengths for your entered age.
| Term | Gift Value | % of FMV | Est. Home at Term | Tax Saved | Survival Prob. |
|---|
After the QPRT Term: Paying Rent
Once the term ends and the home passes to your children, you must pay fair market rent to continue living there. This is actually an additional estate planning benefit: the rent payments transfer additional assets to your children tax-free (as they offset the children's rental income with expenses). The IRS expects rent at market rates.