Halfway through 2026, the federal estate and gift tax exemption households have been planning around since last summer's One Big Beautiful Bill Act is no longer a future number - it is the live rule for the year, at $15 million per person and $30 million for a married couple, permanent and set to adjust for inflation starting in 2027. With the deadline pressure that drove a wave of 2025 gifting now gone, estate attorneys report families are still moving assets out of their estates this year, just for a different reason: locking in growth, not beating a cliff.
What changed
Unlike the run-up to 2026, when advisors urged clients to use a shrinking exemption before it dropped, the current exemption has no expiration date built into current law. Northwestern Mutual's summary of the law notes that permanent "just means that there is no expiration date; it doesn't mean that the laws can't change down the road" - a caveat that shapes how families are actually approaching the window this year. Rather than treating 2026 as a use-it-or-lose-it deadline, many are treating it as the largest exemption they are likely to see relative to their estate's current size, before continued growth or a future Congress changes the math.
Who is affected
The families acting now tend to be well above the $30 million threshold for couples, since anyone comfortably under that figure has little reason to rush a gift purely for estate tax purposes. For those larger estates, the strategy has shifted from simple gifts to structures built to keep future appreciation out of the estate permanently: spousal lifetime access trusts, or SLATs, which let one spouse gift assets into a trust that still indirectly benefits the other spouse, and dynasty trusts funded with generation-skipping transfer tax exemption, which can shelter multiple generations of growth from estate tax at each death.
The after-tax math
Example: a couple with a $50 million estate uses $20 million of their combined $30 million exemption in 2026 to fund a dynasty trust with shares of a family business, then continues using their remaining exemption on annual exclusion gifts of $19,000 per recipient to children and grandchildren, which do not count against the lifetime exemption at all. If those business shares held in trust double in value over the next decade, that $20 million of growth happens entirely outside both spouses' estates - avoiding roughly $8 million in federal estate tax at the current 40% top rate on the appreciation alone, compared with holding the same shares personally until death.
| Tool | What it does with the 2026 exemption |
|---|---|
| Dynasty trust | Shelters growth from estate tax across multiple generations using GST exemption |
| SLAT | Removes assets from the donor's estate while preserving indirect spousal access |
| Annual exclusion gifts | Move up to $19,000 per recipient per year with no exemption used at all |
Moves to discuss with your advisor
- Confirm GST allocation, not just the gift. A gift to a dynasty trust only shelters future generations if generation-skipping exemption is properly allocated on a timely filed gift tax return.
- Weigh gifting against Trump Account contributions. Families funding new Trump Accounts for grandchildren should coordinate that giving with any SLAT or trust funding, since both draw on the same household gifting budget even though the gift tax treatment of Trump Account contributions themselves is still being clarified by Treasury.
- Revisit trusts drafted under deadline pressure in 2025. Households that rushed a SLAT or similar vehicle to beat the old cliff may want to confirm trustee powers and funding still match their goals now that there is no clock running.
What to watch
The open question families are watching is not the 2026 number itself, which is settled, but what happens after it. Congressional control can change in 2027 and again in 2029, and a future repeal or reduction of the exemption remains legally possible even though today's law has no sunset date. Families using dynasty trusts and SLATs this year are, in effect, betting that today's historically large exemption is worth locking in now rather than waiting to see whether it survives the next decade of politics.
Sources
- First reported 15 changes in the One Big Beautiful Bill Act and how they may impact you — Northwestern Mutual
- Working Families Tax Cuts — IRS
- Trump Accounts Launch July 4, 2026: Key Timing, Estate, and Gift Tax Implications — CBIZ
After TAX is an independent publication. Articles are general information, not tax, legal or investment advice. Consult a licensed professional about your situation.
