High-Net-Worth Alert: 5 Critical OBBBA Tax Changes Taking Effect in 2026

Article | October 02, 2025

Authored by Your Firm LLC

The One Big Beautiful Bill Act (OBBBA), signed into law on July 4, 2025, brings sweeping changes to the tax landscape—and wealthy individuals face some of the most significant impacts. While many provisions take effect in 2026, the time to plan is now.

"The OBBBA creates both opportunities and challenges for high-net-worth clients," explains Jennifer French, CPA and Partner at MBN & Company. "Those who act strategically before 2026 can maximize benefits and minimize the sting of new limitations."

The Game-Changing Provisions

1. Permanent Lower Tax Rates (But With a Catch)
Good news first: The TCJA's lower individual tax rates are now permanent, keeping the top rate at 37% instead of reverting to 39.6%. However, there's a significant caveat—starting in 2026, itemized deductions will be capped at a 35% benefit, effectively creating a 2% surcharge on deductions for top earners.

2. Charitable Deduction Floor
Beginning in 2026, charitable contributions must exceed 0.5% of adjusted gross income before they become deductible. Combined with the 35% cap on itemized deductions, this represents a meaningful reduction in charitable tax benefits for wealthy philanthropists.

3. Enhanced Estate and Gift Tax Exemptions
The unified exemption increases to $15 million per individual ($30 million for couples) starting in 2026, up from the current $13.99 million. This permanent increase provides significant estate planning opportunities.

4. Qualified Small Business Stock (QSBS) Expansion
For QSBS issued after July 4, 2025, the exclusion limit increases from $10 million to $15 million, and the qualifying business asset threshold rises from $50 million to $75 million. New tiered holding periods offer partial exclusions for shorter holds.

5. SALT Deduction Modifications
While the $10,000 SALT cap remains permanent, there's a temporary increase to $40,000 (phasing down based on income) from 2025-2029, providing some relief for high-tax state residents.

Strategic Moves to Make Now

The window between now and 2026 presents crucial planning opportunities. Consider accelerating charitable giving into 2025 to capture full deductibility at current rates. Review investment portfolios for tax-loss harvesting opportunities, and evaluate whether business restructuring could qualify for enhanced QSBS benefits.

"We're already seeing sophisticated clients implement multi-year strategies," notes Christopher Lemley, Tax Director at MBN & Company. "The key is coordination—these changes don't exist in isolation, and the interplay between different provisions can create unexpected outcomes."

Estate planning documents require immediate review. Many wills and trusts contain provisions based on lower exemption amounts and may need updates to reflect the new $15 million threshold. For business owners, this is an opportune time to consider succession planning strategies that leverage both the higher exemptions and current valuation discounts.

Don't Navigate Alone

The OBBBA's complexity demands expert guidance tailored to your specific situation. High-net-worth taxpayers face unique challenges that require sophisticated planning across multiple disciplines—from tax strategy and estate planning to investment management and business structuring.

At MBN & Company, our team of specialists works collaboratively to help wealthy individuals and families navigate these changes while optimizing their overall financial position. We combine deep technical expertise with the personal attention that our high-net-worth clients expect and deserve.

Ready to assess how the OBBBA affects your wealth strategy? Contact our team at MBN & Company for a comprehensive review of your situation and a customized plan to maximize opportunities while minimizing risks in the new tax environment.