With the scheduled expiration of the Tax Cuts and Jobs Act (“TCJA”) looming, 2025 was shaping up to be a critical year for estate planning. On July 4, 2025, the uncertainty that hung over planners and clients lifted when President Trump signed the One Big Beautiful Bill Act (the “Act”). The Act provides much needed clarity and stability for individuals.

New Law

The dreaded snap-back to roughly $7.5 million in 2026 is gone, and the elevated federal estate tax exemption amounts have been extended beyond their original sunset date of December 31, 2025. This means that individuals may continue to transfer significant wealth without incurring federal transfer taxes.

For the remainder of this year, the last inflation adjustment under the TCJA is still in effect with an exclusion amount of $13,990,000 per individual. As of January 1, 2026, the Act sets the federal transfer tax exemption to a flat $15,000,000 per person, with 2025 as the new base year for inflation indexing. Unlike the TCJA, the increased exemption amounts under the new legislation do not expire and will continue to increase each year.

What This Means for Planners and Clients

With the exemption extension now law, the urgency that surrounded 2025 planning has eased and planners and clients can breathe a sigh of relief. Clients no longer face a year-end deadline to “use it or lose it,” and planners can shift from crisis-mode to long-term strategic planning. However, tax policy is subject to change as administrations shift, and while the new law permanently extends the TCJA-era exemption, “permanent” exemptions have been reversed before.

Moreover, there are a number of reasons it may still be beneficial to make transfers sooner rather than later, such as locking in today’s valuations for assets expected to appreciate, or capturing discounts that could shrink once markets rebound or previously shelved tax regulations tighten.

What You Can Do Now

The high exemption presents an opportunity to engage in thoughtful, strategic planning without the pressure of a hard deadline.

• Review and Update Your Estate Plan. Use this as an opportunity to reassess your objectives and ensure your estate plan aligns with your current financial situation and family goals.

• Consider Strategic Lifetime Gifting. Even without a looming deadline, many clients may still benefit from making lifetime gifts to take advantage of valuation discounts, asset appreciation outside the estate, and creditor protection.

• Stay Engaged and Educated. Although the new law provides welcome certainty, estate tax policy is subject to change. Staying engaged with your financial advisor, estate planner, and tax professional ensures that your plan evolves with future developments.