estate tax

When someone dies leaving property or money above a certain value, the government levies an estate tax on those assets. If your aunt owned a private island and two yachts, her death may require payment of an estate tax.

Though estate taxes tend to be unpopular — and are often referred to as "death taxes" — they apply only to extremely wealthy people. In the U.S., any estate worth less than $11 million isn't subject to this tax, and there are also many exceptions to the tax requirement. Money from the estate tax, like money from other kinds of taxes, is used to fund public schools, the military, infrastructure like roads and bridges, and other public services.