Oklahoma has no estate tax, though some Sooner State residents may pay the federal estate tax if their estate is above a certain size. This page will walk Oklahomans through the estate tax so they can better plan their estate and make sure their family is prepared to deal with their death.
Do you have questions about estate planning? Consider speak with a financial advisor today.
Oklahoma Estate Tax
Oklahoma does not have an estate tax, making it one of 38 such states.
What Is the Estate Tax?
The estate tax applies to the estate of a person who recently died, before the money and assets held in the estate are dispersed to the person’s legally designated heirs. The estate tax is sometimes also called the “death tax.” It only applies to estates that reach a certain asset threshold, which is determined by the entity or government levying the tax.
Inheritance taxes are different from estate taxes. Inheritance taxes apply to money and assets already passed to heirs, who pay the the tax on their inheritance.
Oklahoma Inheritance and Gift Tax
![Oklahoma Estate Tax](https://smartasset.com/wp-content/uploads/sites/2/2018/12/ok-map-1.png)
Oklahoma has no inheritance tax either. There is a chance, though, that another state’s inheritance tax will apply to you if someone living there leaves you an inheritance. Kentucky, for instance, has an inheritance tax that applies to all property in the state, regardless of whether the person inheriting the property lives in the state. If someone out-of-state leaves you an inheritance, check local laws so you don’t end up having to deal with the consequences of a missed tax payment.
Oklahoma also has no gift tax. The federal gift tax has a $19,000 yearly limit for each gift recipient in 2025, increasing to $18,000 in 2024. If you gift one person more than $19,000 in a year, you must report that to the IRS. The amount exceeding the limit counts against your 2025 lifetime gift tax exemption of $13.99 million. It also decreases your federal estate tax exemption.
Federal Estate Tax
Though Oklahoma has no estate tax, the federal estate tax will apply to Sooner State residents with large enough estates. The federal estate tax has an exemption of $13.99 million for 2025. This exemption is portable, meaning that one spouse can pass their exemption to the other. Collectively, a married couple can protect up to $27.98.
Any estate with value exceeding the exemption is subject to a progressive estate tax. The top rate is 40%.
Here is an example: Let’s say your estate is worth $22.81 million and you are not married. Subtracting the $13.99 million exemption, you have a taxable estate of $8.82 million, placing you in the top tax bracket. You owe $345,800 on the first $1 million. You also owe 40% of the remaining $7.82 million, which comes out to $3.128 million. Add back the base payment and you’ll get the total tax burden, which is $3,473,800.
Federal Estate Tax Rates
Taxable Estate* | Base Taxes Paid | Marginal Rate | Rate Threshold** |
$1 – $10,000 | $0 | 18% | $1 |
$10,000 – $20,000 | $1,800 | 20% | $10,000 |
$20,000 – $40,000 | $3,800 | 22% | $20,000 |
$40,000 – $60,000 | $8,200 | 24% | $40,000 |
$60,000 – $80,000 | $13,000 | 26% | $60,000 |
$80,000 – $100,000 | $18,200 | 28% | $80,000 |
$100,000 – $150,000 | $23,800 | 30% | $100,000 |
$150,000 – $250,000 | $38,800 | 32% | $150,000 |
$250,000 – $500,000 | $70,800 | 34% | $250,000 |
$500,000 – $750,000 | $155,800 | 37% | $500,000 |
$750,000 – $1 million | $248,300 | 39% | $750,000 |
Over $1 million | $345,800 | 40% | $1 million |
*The taxable estate is the total above the 2025 federal exemption of $13.99 million.
**The rate threshold is the point at which the marginal estate tax rate kicks in.
Overall Oklahoma Tax Picture
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Oklahoma is a tax-friendly state for retirees. The state does not tax Social Security benefits. It only partially taxes income from private and public pensions and retirement accounts, including 401(k) plans and IRA plans. This income is taxed, but a $10,000 deduction applies to all retirement income other than Social Security benefits. If your total income is less than the deduction, you’ll pay no tax. The income tax in Oklahoma is progressive, with rates ranging from 0.25% to 4.75%.
Oklahoma has low property taxes. The average effective rate is just 0.85%.
Estate Planning Tips
- Hiring a financial advisor might be helpful if you’re building an estate plan. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
- Don’t forget to update your estate plan. As your life and your financial situation changes, you’ll want to appropriately update your plan to reflect those changes.
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