Estate Freeze Calculator
Estimate estate tax savings from an intentionally defective grantor trust (IDGT) estate freeze. Compare wealth transfer with and without freezing asset values.
Tax Disclaimer
This calculator provides estimates based on general tax rules and may not reflect your specific situation. Tax laws vary by jurisdiction and change frequently. Consult a qualified tax professional or CPA for advice tailored to your circumstances.
Inputs
Results
Estate Tax Savings
$0.00
Tax-Free Wealth to Heirs
$5,045,158.00
≈ 12 average U.S. homes
Figures current as of 2026. Source: IRS Rev. Proc. 2025-32 (OBBBA basic exclusion)
How to Use This Calculator
- Enter Current Asset Value for the assets you plan to freeze via a GRAT, installment sale, or similar strategy.
- Set Expected Annual Growth % — the freeze works best when asset growth exceeds the AFR.
- Enter AFR / Section 7520 Rate from IRS.gov for the current month.
- Set Holding Years and any Lifetime Exemption Already Used.
- Review Estate Tax Savings and Wealth Transferred to heirs tax-free above the note amount.
- Estate freeze strategies are complex — work with an estate planning attorney and tax advisor.
How the result changes with Time Horizon (Years)
| Time Horizon (Years) | Estate Tax Savings | Tax-Free Wealth to Heirs |
|---|---|---|
| 4.9 | $0.00 | $762,759.00 |
| 15 | $0.00 | $5,045,158.00 |
| 26 | $5,614,706.00 | $17,536,765.00 |
| 36 | $16,847,884.00 | $43,119,711.00 |
What each input means
- Current Asset Value ($)
- Fair market value of the asset(s) you plan to transfer to the trust.
- Expected Annual Growth (%)
- Projected annual appreciation rate of the frozen assets.
- AFR / Section 7520 Rate (%)
- IRS Applicable Federal Rate for the note. The freeze works best when AFR is low relative to growth.
- Time Horizon (Years)
- Number of years until estate transfer / death.
- Lifetime Exemption Already Used ($)
- Amount of your $15,000,000 (2026) lifetime gift/estate tax exemption already used, set by OBBBA. Adjusted annually for inflation.
What each result means
- Estate Tax Savings
- Reduction in estate tax from the freeze strategy vs. holding assets in estate.
- Tax-Free Wealth to Heirs
- Appreciation above the note amount that passes to beneficiaries without transfer tax.
- Net to Heirs (With Freeze)
- Total value heirs receive after estate taxes under the freeze strategy.
- Net to Heirs (No Freeze)
- Total value heirs receive without any estate freeze planning.
- Estate Tax (No Freeze)
- Estate tax liability if assets remain in the estate at full appreciated value.
- Required Seed Gift
- Typical 10% equity cushion gift to fund the trust (uses lifetime exemption).
- Future Asset Value
- Projected asset value at the end of the time horizon.
- Break-Even Growth Rate
- Minimum annual growth rate needed for the freeze to transfer wealth. Approximately equals the AFR.
How this is calculated
Worked example, using the default values
- Identify Input Parameters4 parametersCurrent Asset Value ($) = 5000000, Expected Annual Growth (%) = 7, AFR / Section 7520 Rate (%) = 5, Time Horizon (Years) = 15 = 5 input(s) provided
- Calculate Estate Tax SavingsEstate Tax Savings = estateTaxNoFreeze - estateTaxFreeze0 = $0
- Calculate Tax-Free Wealth to HeirsTax-Free Wealth to Heirs5045158 = $5,045,158
- Calculate Net to HeirsNet to Heirs13795158 = $13,795,158
- Calculate Net to HeirsNet to Heirs = futureValueNoFreeze - estateTaxNoFreeze13795158 = $13,795,158
Figures and sources
- 2026 federal lifetime gift/estate tax exemption (2026) — IRS Rev. Proc. 2025-32 (OBBBA basic exclusion)
Engine last updated . Checked against 2 independently-derived tests — how we verify calculators.
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