Tools for Heirs and Beneficiaries in District of Columbia

District of Columbia levies an estate tax above $4,988,400 (top rate 16%) and no inheritance tax; the federal estate tax applies above $15,000,000.

All Planning ahead Settling an estate

6 tools for District of Columbia

Who Inherits Without a Will?

Without a will in District of Columbia, a surviving spouse takes the first $0 plus two-thirds of the rest when every child of either spouse is a child of both, and descendants divide what passes to them per stirpes.

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How Much Are Estate & Inheritance Taxes?

District of Columbia levies an estate tax above $4,988,400 (top rate 16%) and no inheritance tax; the federal estate tax applies above $15,000,000.

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What Taxes Apply to My Inheritance?

In District of Columbia, beneficiaries owe no inheritance tax and the estate pays any estate tax above $4,988,400; probate assets arrive when the estate closes, 6 months to 12 months for a simple estate.

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How Does Step-Up in Basis Work?

Inherited assets in District of Columbia take a basis reset to fair market value on the date of death, and the gain on a later sale faces ordinary income tax at the state's regular rates.

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When Do I Have to Withdraw an Inherited IRA?

See which federal withdrawal rules apply to an inherited IRA, Roth IRA, or employer plan, the deadline year, and the missed-withdrawal tax.

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Do I Have to File Tax Returns for Someone Who Died?

District of Columbia requires a final state income tax return for the decedent alongside the federal Form 1040; a federal estate tax return (Form 706) is required only for estates above $15,000,000.

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Yes. District of Columbia imposes a state estate tax on an estate above $4,988,400, separate from and in addition to the federal estate tax. District of Columbia has no inheritance tax on the beneficiary.

The District of Columbia estate tax exemption is $4,988,400; an estate below it owes no state estate tax. The exemption is indexed to inflation and adjusts each year. A taxable estate faces graduated rates up to 16%.

No. The IRS does not treat inherited money, real estate or personal items as income, so a beneficiary in District of Columbia does not report them on a federal return when received. Two exceptions: an inherited retirement account (a 401(k) or a traditional IRA) is taxed as ordinary income as it is withdrawn, and earnings after the date of death are taxable. Inherited property takes a stepped-up basis, its value on the date of death, for any later capital gain.

When someone dies, the cost basis of the property they leave is reset to its fair market value on the date of death under IRC § 1014. A later sale is taxed on the gain above that stepped-up basis, not above what the original owner paid, so the appreciation of the owner's lifetime is never taxed. The rule is federal and applies in District of Columbia as in every state.

District of Columbia intestacy law decides. District of Columbia follows separate property rules: the surviving spouse's share depends on whether children survive and whose children they are. The estate passes to the closest surviving relatives, in most cases the spouse and children first, then in order: Parents; Siblings and their descendants; All collateral relations in equal degree; Grandparents; The District of Columbia.

Tools for Heirs and Beneficiaries in District of Columbia

Estate taxes are paid by the estate before anything is distributed; inheritance taxes are paid by the person who receives the property. In 2026 the federal estate tax reaches only estates above $15 million per person, and there is no federal inheritance tax. 12 states plus the District of Columbia levy their own estate tax at lower thresholds, and 5 states levy an inheritance tax whose rate depends on the beneficiary's relationship to the person who died.

Beneficiaries in District of Columbia owe no inheritance tax; the estate pays any estate tax before distribution; inherited assets take a basis reset to fair market value on the date of death, and the gain on a later sale faces ordinary income tax at the state's regular rates. Probate assets arrive when the estate closes: a simple estate closes in 6 months to 12 months.

SimplyTrust Editorial·Updated September 15, 2026

Legal Sources

Data sourced from District of Columbia statutes and official state code. How we research.