Billionaire Warren Buffett is ahead of the curve in life and in death. Because the Oracle of Omaha still lives in his beloved-Nebraska, his heirs will be exempt from a state death tax (also known as the estate tax). Whereas the Jeff Bezos estate would lose an extra $12 billion in estate taxes if he dies while living in his home state of Washington, Nebraska does not have an estate tax.
That said, dying is easily one of the most expensive activities any billionaire can do.
The Federal Estate Tax Is Massive
Even though he would be exempt from a state death tax, Buffett would owe roughly the total net worth of Space X in federal taxes. As of 2019, an estate worth $11.4 million or more owes the maximum 40% in federal taxes.
With Warren Buffett’s net worth hovering around $82.6 billion, he would owe about $33,040,000,000 to the United States if he died today. That’s enough to buy SpaceX, Spotify, or Airbnb.
Estate Tax Rates | Screenshot from irs.gov
Not All Death Taxes Were Created Equal
Some states, in fact, most states, have no death tax at all. While most states with estate taxes charge different rates depending on the size of the estate, some states, like Vermont, have a fixed rate.
Meanwhile, even though Warren Buffett wouldn’t owe any state death tax, Nebraska does have an inheritance tax. This tax does not apply to spouses.