If you’ve been keeping an eye on estate taxes, there’s some good news to share. Thanks to the enactment of the One Big Beautiful Bill Act (OBBBA), there are some new “permanent” increases to the federal estate tax. Let’s unpack what’s happening, what’s sticking around, and how you can make the most of these updates.
Federal Exemption Increase: Breathing Room for Your Plans
Kicking off in 2026, each person gets a whopping $15 million exemption for estate, gift, and GST taxes—that’s $30 million for couples! Woohoo.
TCJA Sunset Elimination: Less Stress, More Planning
Remember all the buzz about the TCJA “sunsetting” and exemptions dropping in half? That’s off the table. With the sunset gone, you can breathe easier and plan for the long-term without rushing to make big decisions or gifts before an expiration date. The rules are clearer for now—and that’s a win for peace of mind.
Federal Estate Tax Takes a Backseat
With these high exemptions, most Americans can cross federal estate tax off their worry list. This gives you space to think about other things, like how to maximize your legacy, help your kids and grandkids thrive, or support causes close to your heart. And if your estate is under $15 million ($30 million for couples), you’re in the clear—no complicated federal tax avoidance needed.
State Estate Taxes: Still A Concern
Here’s the catch: while federal estate tax is less of an issue, some states still have their own estate or inheritance taxes. If you’re a Massachusetts resident, like most of us, the $2 million state estate tax exemption is still a significant concern. This is why it is still important for us to consider options like gifting, shifting assets, or establishing trusts to help minimize the impact of state estate taxes with the guidance from our trusted advisors.
Planning Clarity and “Permanence”—With a Grain of Salt
While all these updates feel permanent now, it’s good to remember tax laws can change. Political shifts, new priorities, and budget pressures mean the rules could get tweaked again down the line. So keep your estate plan flexible, stay informed, and check in with your advisor from time to time to make sure you’re staying ahead. And as always, don’t hesitate to ask for help if you need it!
Give us a call at 508-202-1818 or schedule a consultation today to discuss the impact of OBBBA and how it pertains to your particular estate tax planning situation.