Planning Ahead: Take Advantage of the New Estate and Gift Tax Limits
July 18, 2025
By Julie Squiers, CPA
Tax Manager
With the enactment of the One Big Beautiful Bill Act, the lifetime estate and gift tax exemption has been permanently extended, offering favorable outcomes for taxpayers. This legislation solidifies the higher exemption threshold, increasing the limit to $15 million per individual starting in 2026 with annual adjustments for inflation. This enhanced exemption also applies to the Generation-Skipping Transfer Tax (GSTT). Prior to this legislation, the exemption was scheduled to sunset in 2026, reverting to approximately $7 million per individual — a significant decrease from the 2025 exemption of $13.99 million.
The Deceased Spousal Unused Exclusion (DSUE) provision remains intact, allowing surviving spouses to elect portability and preserve any unused portion of their spouse’s lifetime exemption. Additionally, the annual gift tax exclusion remains at $19,000 per individual for 2025.
While the exemption is now permanent under current law, future legislation could change it. Taxpayers should review their estate plans to take full advantage of the current limits. For personalized guidance, contact us.
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