The higher exemption levels created by the 2017 tax law were scheduled to expire at the end of 2025, and anyone with a sizable estate heard the same message: use your exemption before it gets cut roughly in half, or lose the chance. A lot of families made large gifts under that pressure. Then the deadline vanished.
The One Big Beautiful Bill Act set the federal estate and gift tax exemption at $15 million per person for 2026, made it permanent, and tied it to inflation starting in 2027. For a married couple, that is up to $30 million shielded from federal estate tax by using both spouses’ exemptions. The sunset everyone braced for simply isn’t coming.
That changes the nature of the conversation. It’s no longer about racing a clock. It’s about using a stable, generous set of rules well.
A few things are worth revisiting now.
If you made large gifts in 2024 or 2025 to get ahead of the old deadline, you may have fresh exemption to work with. Someone who used most of a $13.6 million exemption a couple of years ago now sits under a $15 million ceiling, which frees up additional room for further gifting if that fits your goals.
If your estate falls comfortably under the threshold, and most families’ estates do, the priority shifts. Federal estate tax probably isn’t your concern, but preserving the step-up in basis is. When assets pass at death rather than by lifetime gift, heirs generally inherit them at current market value, which can erase a large built-in capital gain. Gifting appreciated assets while you’re alive can accidentally give that benefit away, so the old instinct to move everything out of your estate isn’t always the right one anymore.
Married couples should also confirm that portability is handled correctly. A surviving spouse can pick up a deceased spouse’s unused exemption, but only if the estate files the return that formally elects it. Skipping that filing because an estate seems small can quietly forfeit millions in future protection.
And the ordinary tools still work. The annual gift exclusion sits at $19,000 per recipient for 2026, which means a couple can move $38,000 to each child, grandchild, or anyone else every year without touching the lifetime exemption at all. Done consistently, that adds up in a hurry.
Permanent doesn’t mean finished. It means the planning can finally be built on solid ground instead of a deadline. If your documents were drafted around the old sunset, they’re worth a fresh read.
This post is for educational purposes only and is not legal or tax advice. Estate planning depends heavily on your individual circumstances and on state law, so please work with a qualified attorney or advisor.