OBBBA Opens New Estate Planning Doors: Don't Let This Window Close

Article | August 27, 2025

Authored by Your Firm LLC

The signing of the One Big Beautiful Bill Act (OBBBA) on July 4, 2025, has fundamentally reshaped the estate planning landscape. With the federal estate and gift tax exemption permanently increased to $15 million per individual (effective 2026), high-net-worth families now have unprecedented certainty and opportunity to secure their financial legacy.

But here's what many don't realize: this expanded exemption creates both immediate opportunities and urgent deadlines that require swift action.

The Game-Changing Numbers

Under OBBBA, married couples can now transfer up to $30 million to future generations completely free of federal estate tax – a dramatic increase from the previous $13.99 million per person limit. This permanent change eliminates the uncertainty that had families scrambling to make decisions before the 2026 sunset provision.

"The permanence of this exemption is a game-changer for our clients," explains [Internal Expert Name], Partner at MBN & Company. "We're seeing families who had previously maxed out their exemptions suddenly have millions of dollars in additional tax-free gifting capacity. This creates a unique window to implement sophisticated wealth transfer strategies."

The increased exemption is particularly valuable for clients with hard-to-value assets. The larger cushion provides protection during IRS audits if asset valuations are challenged – a crucial consideration for family business owners and real estate investors.

The Income Tax Trade-Off You Must Consider

While the higher exemption reduces estate tax exposure for many families, it introduces a new strategic decision: should you focus on minimizing income taxes or estate taxes? With fewer estates now subject to federal estate tax, many families can shift their attention to reducing the income tax burden on their heirs.

Here's the critical difference: assets gifted during your lifetime carry over your tax basis to the recipient. However, assets transferred at death receive a "stepped-up" basis to fair market value, eliminating capital gains tax for your heirs. For a property purchased for $200,000 and now worth $1 million, this difference could save your children $160,000 in capital gains taxes.

"We're working closely with families to model both scenarios," notes [Internal Expert Name], Director of Tax Services at MBN & Company. "For many of our clients, the math now favors holding appreciating assets until death rather than gifting them, which represents a complete reversal from pre-OBBBA planning strategies."

Strategic Action Steps

The expanded exemption creates several immediate opportunities that savvy families are already beginning to exploit. First, many families who previously made large gifts to use their exemptions may now discover they have significant unused capacity to shield future transfers. This recalibration of existing plans can unlock millions in additional tax-free wealth transfer potential.

The higher exemptions also make sophisticated irrevocable trust structures more attractive and feasible than ever before. These advanced trust strategies, once reserved for only the ultra-wealthy, are now accessible to a broader range of affluent families seeking to maximize their wealth transfer efficiency.

Equally important is the strategic gifting of appreciating assets. By transferring assets expected to grow significantly in value, families can effectively remove not just the current value but all future appreciation from their taxable estate. This approach becomes particularly powerful when combined with valuation discounts available for family business interests and other hard-to-value assets.

However, families must also navigate the complex landscape of state estate taxes, where several states maintain their own systems with exemption amounts significantly lower than the new federal threshold. This patchwork of regulations requires careful coordination to avoid unexpected tax liabilities at the state level.

Why Timing Matters

Despite the permanent nature of OBBBA's changes, wealthy families shouldn't assume unlimited time for planning. Political landscapes shift, and future legislation could modify these provisions. The window of certainty we have now may not last indefinitely.

More importantly, every day of delay means missed opportunities for tax savings and wealth preservation. Assets that continue to appreciate in your estate could result in larger future tax liabilities, even under the new higher exemptions.

At MBN & Company, we've guided families through every major tax law change over our six decades of service. Our estate planning specialists understand both the technical complexities and the emotional aspects of wealth transfer decisions. We work collaboratively with your attorneys and other advisors to ensure your estate plan reflects both the new tax landscape and your family's unique goals.

Your Estate Planning Partner

Ready to explore how OBBBA affects your estate plan? At MBN & Company, we've guided families through every major tax law change over our six decades of service. Our estate planning specialists understand both the technical complexities and the emotional aspects of wealth transfer decisions, working collaboratively with your attorneys and other advisors to ensure your estate plan reflects both the new tax landscape and your family's unique goals.

Our comprehensive estate planning services include:

• Estate and gift tax planning: Strategic analysis to maximize your $15 million exemption and minimize tax exposure
• Trust and fiduciary services: Design and administration of irrevocable trusts to optimize wealth transfer
• Business succession planning: Tax-efficient strategies for transferring family businesses to the next generation
• Charitable giving strategies: Coordination with our wealth management team to structure philanthropic goals
• Multi-state tax coordination: Expert guidance for clients with assets across state lines
• Financial projections and modeling: Comprehensive analysis to compare estate tax versus income tax strategies

Contact MBN & Company today to schedule a comprehensive estate planning review with our specialized team. Let us help you navigate these new opportunities and secure your family's financial future.