Bequests and Inheritances

Approximately 2.4 million adults died in the United States in 1999, leaving estates valued at over $196 billion to their families, charities, federal and state governments (via estate taxes), and others. Easily the largest share of estates goes to spouses. Children and charities also receive sizable amounts. Wealth transfers of this magnitude can have significant effects, yet researchers are still working to understand why people leave bequests. Several theories exist, but none fully explains the patterns of bequest distribution observed. The existence of estate taxes likely influences financial choices later in life, and perhaps the distribution of bequests as well. In 1999 the U.S. government collected $22.9 billion in estate and gift taxes—1.25 percent of all revenues collected. State governments collected over $6.1 billion in additional taxes.