💰 Estate & Gift Tax in 2026: The $15 Million Exemption Becomes Permanent — What High-Net-Worth Families Should Do Next
Beginning January 1, 2026, the federal Estate and Gift Tax exemption will be permanently set at $15,000,000 per person and $30,000,000 for married couples.
The previously expected “Sunset reduction” has been eliminated, meaning the exemption will not drop back to pre-TCJA levels.
With this change, estate planning is entering a new era: the focus is shifting toward using a historically high and now permanent exemption to move future appreciation outside the taxable estate.
1️⃣ What Exactly Changes in 2026?
The federal government has finalized a permanent $15 million exemption per person for Estate and Gift Tax purposes.
This replaces the previously expected Sunset reduction. The permanent exemption offers long-term planning stability for high-net-worth families.
The federal estate tax rate remains 40%, but the high exemption significantly expands opportunities for tax-efficient wealth transfer.
• No more Sunset reduction
• Planning now focuses on removing future appreciation from the estate
• Lifetime gifting continues to benefit from no-clawback protections
2️⃣ How a Permanent Exemption Reshapes Planning Priorities
Before the law change, taxpayers rushed to use the exemption before it decreased.
Now, with a permanent exemption, the strategy shifts toward timing and efficiency.
If assets are expected to grow significantly, transferring them now allows decades of appreciation to escape estate taxation entirely.
Freeze the taxable estate today; allow growth to occur in structures outside the estate.
3️⃣ A Practical Example: The Power of Shifting Future Appreciation
A married couple holds approximately $35 million in total assets.
Their projected net worth in 10 years: $50 million.
If they use their exemption today:
• Transfer $30M into a trust
• All growth happens outside the estate
• Estate tax exposure: $0
If they wait 10 years without planning:
• Estate: $50,000,000
• Exemption: $30,000,000
• Taxable amount: $20,000,000
• Estate tax (40%): $8,000,000
➡️ Early planning avoids up to $8 million in federal estate tax.
This demonstrates the value of acting early:
The sooner assets are transferred, the more appreciation avoids taxation.
4️⃣ Four Key Strategies to Consider Right Now
① Strategic Lifetime Gifting
Ideal for assets with high expected growth such as business interests or real estate.
② SLATs (Spousal Lifetime Access Trusts)
Removes assets from the estate while keeping economic access within the family.
③ Credit Shelter Planning
Ensures both spouses fully utilize their exemptions for multi-generational planning.
④ Basis Optimization & Step-Up Management
Gift assets expected to grow; retain low-basis assets for future step-up at death.
5️⃣ EA Practice Tips for Real-World Implementation
1) For estates above $20M, model appreciation scenarios annually
2) Avoid reciprocal trust issues when creating two SLATs
3) Secure appraisals early for closely held businesses or real property
4) Be mindful of IRC §643(f) multi-trust rules
5) Reevaluate basis planning after significant gifts
6️⃣ Google-Friendly FAQs
It is possible through legislation, but under current law the $15M exemption is permanent and not scheduled to sunset.
No. The IRS no-clawback rule protects lifetime gifts even if the exemption decreases later.
Yes, but to avoid the reciprocal trust doctrine, each trust must include meaningful differences in structure and terms.
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This article summarizes U.S. federal estate and gift tax rules as of December 2025.
State-level estate or inheritance taxes may apply separately.
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