Does California have an estate tax?  Do I need to file a California estate tax return?

Like the federal government, most states have some form of Estate Tax (sometimes referred to as a ‘death tax’ when considered in combination with inheritence taxes).  The states generally follow the federal government’s exemption amounts – anyone who dies with less than the exemption amount in their estate is spared taxation.

California, however, is not one of those states.  California has no state Estate Tax, and is not likely to enact one in the next decade at least, based on current politics.  You will not file a California estate tax return, though you will still  need to consider filing the decedent’s past due tax returns, final tax returns, fiduciary tax returns, etc.

That doesn’t mean that, as a California resident, you can necessarily forget about state Estate Taxes.  If you have a diverse portfolio of investments, some of those assets may be in other states.  Typically, if you have property in two states, you’ll likely be subject to the tax laws of both states.

If you’re in that situtation, consult with an experienced estate planning attorney and an estates CPA.