Estate Planning in 2025 and Beyond: What the “One Big Beautiful Bill Act” Means for High-Net-Worth Families

Alan A
United States of America Congress Passes the "One Big Beautiful Bill"

How the “One Big Beautiful Bill Act” Impacts High-Net-Worth Families

In a significant legislative development, the recently enacted One Big Beautiful Bill Act (“OBBBA”) introduces sweeping changes to the federal estate and gift tax landscape. For individuals and families with substantial assets, these changes are not only welcome but potentially transformative. Most notably, the OBBBA raises the federal lifetime estate and gift tax exemption to $15 million per person and makes that increase permanent.

For those engaged in long-term planning or evaluating the timing of substantial gifts, this legislation offers clarity, opportunity, and, perhaps most importantly, time. Below, I break down what this new law entails, what has changed, and how you might approach your estate and tax planning strategy in light of it.

A Brief Legislative Background

The federal estate and gift tax exemption, set at $13.99 million per person in 2025, was previously scheduled to be reduced by roughly half on January 1, 2026, reverting to pre-2018 levels (adjusted for inflation). In anticipation of this “sunset,” many high-net-worth individuals accelerated their gifting strategies to take advantage of the higher exemption before it expired.

The OBBBA effectively eliminates this sunset. Starting in 2026, the federal estate and gift tax exemption will be permanently set at $15 million per person, with annual inflation adjustments based on the 2025 baseline.

Key Provisions of the OBBBA That Affect Estate and Gift Planning

Starting January 1, 2026, the lifetime exemption amount will increase to $15 million per individual, a significant jump from the projected post-sunset level of approximately $7.2 million. For married couples, this effectively allows transfers of up to $30 million free of federal estate and gift tax. As a result, many individuals and families who were previously anticipating estate tax exposure in 2026 may now find themselves entirely exempt. Even those with estates above the new threshold will benefit from a reduced tax burden due to the expanded exclusion.

The law also creates new planning opportunities for those who had previously used or exhausted their exemptions. For instance, someone who fully utilized the $13.99 million exemption in 2025 will gain approximately $1.01 million in additional exemption in 2026. However, prior taxable gifts still count against the lifetime limit, so individuals must carefully account for previous transfers and consult with legal and tax professionals to avoid unintended consequences.

Other Notable Estate and Tax Provisions Under the OBBBA

Portability Rules Remain Intact. The law does not change the rules surrounding “portability,” which allows a surviving spouse to inherit the unused estate tax exemption of their deceased spouse. However, for portability to apply, the executor of the decedent’s estate must file a timely federal estate tax return, even if the estate owes no tax. This often-overlooked filing remains essential to preserving tax benefits.

Tax forms for families with High Net Worth

Generation-Skipping Transfer (GST) Tax Rules Also Unchanged. The GST tax exemption now mirrors the $15 million estate tax exemption. However, unlike the estate tax exemption, unused GST exemption is not portable. Accordingly, individuals seeking to transfer wealth to grandchildren or more remote descendants should consider planning strategies that optimize the GST exemption during their lifetimes.

Additional Provisions for High-Income Taxpayers and Philanthropists. The OBBBA includes several other provisions of note, particularly for individuals with high income or charitable goals:

  • The top individual tax rate of 37% has been made permanent.
  • The state and local tax (“SALT”) deduction cap is temporarily increased from $10,000 to $40,000 for 2025, to $40,400 for 2026
  • Charitable deductions for cash contributions remain capped at 60% of adjusted gross income (AGI), but only for amounts that exceed 0.5% of income, a subtle but meaningful change for large donors.

Strategic Takeaways for Families and Individuals

The passage of the OBBBA eliminates the looming uncertainty around the 2026 sunset and gives high-net-worth families the chance to plan without the pressure of an arbitrary deadline. But that does not mean planning should stop.

Tax laws, even those labeled “permanent,” are subject to change. A future Congress could choose to reduce the exemption, modify GST rules, or introduce new limits on lifetime gifting.

For that reason, now is an ideal time to:

  • Revisit your estate plan
  • Review any prior gifting activity
  • Consider whether new gifting strategies may be appropriate
  • Coordinate with your legal, tax, and financial advisors

Final Thoughts

The One Big Beautiful Bill Act provides certainty, flexibility, and a more generous framework for preserving and transferring wealth. Whether you are just beginning to think about your estate plan or have a well-established structure in place, these new rules are a reason to re-evaluate and refine your approach.

If you have questions about how this new law affects your estate or gifting strategy, or if you’re unsure where to begin, we invite you to schedule a complimentary 15-minute consultation. We’ll help you determine how to make the most of the current legal landscape while aligning your plan with your long-term goals.

Disclaimer: This article is provided for informational purposes only and does not constitute legal or tax advice. Please consult with a qualified professional regarding your specific circumstances.