How to Avoid Estate Tax by Relocating to a No-Tax State
Federal estate tax is the same no matter where you live. But state estate tax varies dramatically. Moving your domicile from a high-tax state to a no-tax state can cut hundreds of thousands or even millions from the tax bill. The key word is domicile — not just owning a second home.
Which states have no estate or inheritance tax
Florida, Texas, Nevada, Tennessee, South Dakota, Alaska, and many others impose no estate or inheritance tax. See the full ranking in our Compare by State tool.
What domicile really means
Domicile is your permanent legal home. States look at where you spend the most time, where you vote, your driver’s license, vehicle registration, where your mail and doctors are, and where you have community ties.
Relocation traps
Some states have gift lookback rules that pull gifts made within a few years of death back into the taxable estate, even after you move. New York and Minnesota are examples. Some states, like Massachusetts, do not recognize portability, so trusts may still be needed.
Estimate the savings
Use our Relocate-to-Save-Tax Calculator to compare your current state and target state side by side. Then confirm the domicile analysis with an attorney licensed in both states.