US Tax Tools

Life Insurance & Estate Tax Calculator

See how life insurance proceeds affect your estate tax — and whether an ILIT could save your heirs hundreds of thousands in taxes.

Your Estate & Insurance

Estate Tax (without insurance)

$0

0% effective rate

Insurance Included in Estate

$5,000,000

§2042 ownership test

Estate Tax (with insurance)

$1,840,000

9.2% effective rate

Insurance Strategy Analysis

ILIT Tax Savings

$1,840,000

Tax saved if policy is moved to an ILIT (after 3-year lookback)

Coverage Gap

Fully covered

Additional insurance needed to cover estate tax liability

Related Calculators

Last updated May 8, 2026 Tax year 2025–2026

Data sources: IRS §2042 — incidents of ownership, IRS Rev. Proc. 2025-38 (estate exemption), IRS Pub 559 — Survivors, Executors, and Administrators

This tool is general information only, not financial advice.

Reviewed by USTax Tools Editorial Desk

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