The One Big Beautiful Bill Act (OBBBA), signed into law on July 4, 2025, includes a major and lasting change to the federal estate, gift, and GST (generation-skipping transfer) exemption. Here’s how it affects estates and gifts starting in 2026 and beyond:

🧾 Key Estate & Gift Tax Changes Under OBBBA

1. Permanent Increase to a $15 Million Exemption (2026+)

• For all deaths or gifts occurring on or after January 1, 2026, the federal lifetime exemption rises to $15 million per person (i.e., $30 million per married couple). Note, the 2025 estate and gift tax exemption is $13.99 million per person.
• This change prevents the scheduled rollback of the exemption back to approximately $7 million per person.

2. Inflation Indexing Begins Using 2025 as the Base Year

• Starting in 2027, the exemption will adjust annually for inflation, using 2025 as the new base year.

3. Other Rules Remain Unchanged

• The federal gift and estate tax rates remain at a maximum of 40% on amounts above the exclusion.
• Portability of unused exemption continues exactly as before—surviving spouses may elect to use a deceased spouse’s unused exemption.
• The GST exemption remains equal to the basic exclusion amount and is not portable between spouses.

🧠 Implications for Planning in 2026 and Beyond

• Estate and gift tax exposure is significantly reduced for high-net-worth individuals.
  • Individuals with estates between $7 million –$15 million (or married couples with up to $30 million) are largely insulated from federal taxation if they haven’t used much of their exclusion already.
• No now-or-never rush to complete gifting strategies by end of 2025:
  • The permanent exemption and indexing ease timing pressure—but a future Congress could alter the law later.

📝 Recommendations

1. Reassess estate plans for those with net worth under or near $15 million (married couples under $30 million) — now there’s room to breathe with federal tax pressure reduced. It might be that a more complicated estate planning structure is no longer needed with the now “permanent” change to the federal estate and gift tax exemption.
2. Estate planning is still vital, even for smaller estates—for clarity, control, and intent beyond pure tax savings.

 

Ready to Get Your Estate Plan in Order?

Whether you’re just getting started or need to update an existing plan, the experienced attorneys at Bivens & Associates, PLLC are here to help. In Arizona? We will guide you through every step to ensure your wishes are clearly documented and your loved ones are protected.

📞 Call us today at (480) 922-1010
📧 Or email us at info@bivenslaw.com
to schedule a personalized consultation.

Peace of mind starts with a plan. Let’s create yours.

Disclaimer: The information contained in this article is provided for informational purposes only, and should not be construed as offering legal advice or creating an attorney client relationship between the reader and the firm or author. You should not act or refrain from acting on the basis of any content included in this article without seeking appropriate legal advice about your individual facts and circumstances from an attorney licensed in your state. Bivens and Associates, P.L.L.C. expressly disclaims all liability with respect to actions taken or not taken based on any or all information contained in this article.