Starting January 1, 2026, the federal estate, gift, and generation-skipping transfer (GST) tax exemption will rise to $15 million per person, or $30 million for married couples, indexed for inflation. This exemption is permanent, unlike past provisions that were set to expire, offering long-term planning certainty. However, the 40% top tax rate remains in place for estates exceeding that threshold. While this change means fewer families will face federal estate tax, it doesn’t eliminate the need for a thoughtful, customized estate plan.
Although OBBBA simplifies estate planning in certain ways, in other ways it brings new layers of complexity to the tax code. Income and capital gains tax rules remain complicated, and many deductions and tax breaks phase out at various income levels. For business owners or families with significant assets, the need for smart planning is greater than ever. In Massachusetts, the state estate tax exemption is still $2 million per person, meaning many estates still face state-level taxation even if they’re exempt federally.
Charitable giving strategies, income shifting, and business succession plans may all need a second look under the new rules. Even with a higher exemption, your estate plan should never be left to drift. Estate plans should be drafted with intention and you should revisit your estate plan whenever life changes or legislation affecting the tax code could have an impact.
No matter what your net worth is—or if you’re concerned about estate taxes—it’s time to schedule a review. At Amaral & Associates, P.C., our experienced estate planning team is here to help you adapt your plan, protect your legacy, and ensure your wishes are carried out efficiently and tax-effectively.
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