What the Big Beautiful Bill Means for Your Estate Plan

When the One Big Beautiful Bill Act (OBBBA) became law on July 4, 2025, it changed the estate planning landscape in a permanent way. For years, families have had to plan around uncertainty—watching exemption amounts rise and fall with political tides and worrying about looming sunsets. Now, there’s a new reality.

A Higher and Permanent Estate Tax Exemption

Under the OBBBA, the federal estate tax exemption is permanently set at $15 million per person (or $30 million for married couples), adjusted each year for inflation. This is more than double the exemption that was scheduled to drop in 2026, giving many families far more breathing room.

For most Americans, this means the estate tax—once considered a central threat to passing wealth to loved ones—may no longer apply at all. Instead of planning primarily to avoid taxes, families now have the opportunity to shift their focus to broader goals: protecting loved ones, preserving harmony, and ensuring wealth is used in meaningful ways.

Ripple Effects Beyond the Numbers

The new exemption doesn’t just reduce tax burdens—it reshapes planning strategies:

• Trusts May Need Revisiting: Trusts built primarily to minimize estate taxes might be unnecessarily complex under today’s rules. Simplification could make administration easier for your future trustees.
  
• New Gifting Opportunities: With higher exemptions, families can transfer wealth during their lifetimes with less concern about hitting limits. This opens doors for lifetime giving, charitable strategies, and funding future generations’ opportunities.
  
• More Flexibility for Couples: Married couples can now rely less on rigid tax-driven structures and more on plans that reflect their unique family dynamics and values.
  

The Bigger Picture: Not Just About Taxes

While the estate tax burden has eased, the OBBBA also carries ripple effects for income taxes and programs like Medi-Cal. For example, California seniors may face stricter asset limits in the future if Medi-Cal eligibility rules tighten. That means your plan should continue to account for healthcare needs, long-term care costs, and financial protections beyond the federal estate tax.

Why You Still Need to Review Your Plan

Even if estate taxes no longer seem to threaten your wealth transfer, your documents may not reflect this new reality. Outdated tax-driven provisions could complicate your estate, burden your trustees, or unintentionally restrict your heirs. A fresh review ensures your plan is aligned with the law—and with your goals.

The Takeaway

The Big Beautiful Bill offers relief and opportunity, but estate planning has never been a “set it and forget it” process. Laws change, families change, and financial goals evolve. Reviewing your plan now ensures you can take advantage of the flexibility this new law provides, while keeping your loved ones protected.