What the Big Beautiful Bill Means for Estate Tax Planning
The new tax law—nicknamed the “Big Beautiful Bill”—was signed into law on July 4th, and it brings some big changes to how estates are taxed. If you own property, a business, or are planning to pass along your assets to your family one day, these changes might matter more than you think.
Before this new law passed, the federal government only taxed very large estates. In 2024, you could pass on up to $13.61 million tax-free per person—or $27.22 million for a married couple. Anything above that amount would be taxed at 40%. Most families never had to worry about this, because their estate wasn’t big enough to hit that threshold.
But that high exemption wasn’t going to last forever. It was set to expire in 2026, cutting the exemption roughly in half, which would’ve brought a lot more families—especially business owners and property owners—into the estate tax net.
The Big Beautiful Bill makes the higher estate tax exemption permanent. That means individuals can continue to pass on $13 million+ tax-free, and couples nearly $27 million, without paying federal estate tax. This change gives families more time—and more certainty—when it comes to planning their legacy.
If you’ve already done estate planning, you don’t need to rush to change anything. But if you were holding off, this might be the time to take another look. The risk of a sudden drop in the exemption amount is now off the table, at least for the foreseeable future.
For family-owned businesses, farms, and anyone holding valuable real estate, the estate tax can be a major concern. Sometimes families are forced to sell property or part of the business just to pay the tax bill when a loved one passes away.
By keeping the exemption high, the law helps families keep those businesses and assets intact from one generation to the next. It gives people more flexibility to focus on real planning—like choosing trustees, setting up trusts, or gifting assets during life—without the pressure of looming estate tax deadlines.
Other Key Points
- The 40% estate tax rate stays the same, but it only applies above the new higher exemption.
- The law also locks in the gift tax exclusion rules, so you can still give away a lot during your lifetime without triggering taxes.
- Step-up in basis rules remain unchanged. That means your heirs still get to reset the value of your property to market value when they inherit, which can reduce capital gains tax if they sell later.
Final Thoughts
Estate planning may not be the most exciting topic, but it’s one of the most important—especially now that the rules are more stable. Whether you’re a business owner or just want to make sure your family is taken care of, these changes give you room to plan with confidence.
If you have questions or want help reviewing your estate plan, reach out to us at Gemini Accounting Services LLC. We’ll help make sense of it all.