Estate Planning Just Got a $15M Upgrade: 5 Steps to Protect Your Wealth Before These Tax Breaks Disappear

Most wealthy families are scrambling to figure out the new estate planning rules. Smart entrepreneurs are already three steps ahead.

The One Big Beautiful Bill Act (OBBBA) just handed you the biggest estate planning opportunity in decades: but here's what nobody's telling you: the window to maximize these benefits isn't as wide as you think. While the $15 million exemption per individual ($30 million per couple) becomes permanent starting January 1, 2026, the real urgency comes from what's happening right now in 2025.

Quick Answer: You need to act before political winds shift and these generous exemptions get scaled back. The OBBBA's permanent status only lasts until Congress decides to change it again: and budget pressures could make that sooner than later.

Here's your strategic roadmap to lock in generational wealth protection before these tax breaks potentially disappear.

Step 1: Audit Your Current Estate Plan (It's Probably Broken)

Your existing estate plan likely became obsolete the moment OBBBA passed. Most trust documents written before 2025 contain formula clauses tied to "the exemption amount at death": which means they could now fund trusts with $15 million instead of the $5-7 million your attorney originally planned for.

This isn't just a minor adjustment: it's a complete strategic overhaul. According to Treasury regulations, older trust documents frequently create unintended consequences when exemption amounts increase dramatically. Your bypass trust might now receive three times more assets than intended, potentially starving your surviving spouse of needed resources.

Schedule an immediate comprehensive review with your estate planning attorney to examine:

• All trust documents and their funding mechanisms

• Beneficiary designations across retirement accounts and life insurance

• State-specific tax rules that interact with federal changes

• Whether your plan includes flexibility provisions like trust decanting powers

Pro tip: Look specifically for "formula clause" language in your documents. These clauses automatically adjust based on federal exemption amounts: which could now trigger massive unintended transfers to trusts instead of your spouse.

Step 2: Lock In Your Exemption Through Strategic Lifetime Transfers

Here's the wealth-building secret most CPAs won't tell you: Gifts made using today's higher exemption are permanently grandfathered, even if Congress later reduces the threshold.

Per IRS regulations, if you gift $13 million in 2025 using the current $13.99 million exemption, and Congress later slashes the threshold to $7 million in a future year, your prior gifts remain completely sheltered from estate taxation.

This creates an unprecedented "use it and keep it" opportunity. While there's no longer a December 31, 2025 sunset deadline hanging over your head, political reality suggests acting sooner provides better protection against future legislative reversals.

The math is compelling: For families with estates approaching or exceeding $15 million, making lifetime transfers now using your available exemption essentially locks in tax-free wealth transfer at today's generous levels. Even if future Congresses reduce exemptions due to budget pressures from OBBBA's own costs, your completed transfers remain protected.

Key strategies include:

• Direct gifts to children or grandchildren using your lifetime exemption

• Sales to intentionally defective grantor trusts (IDGTs)

• Charitable lead annuity trusts (CLATs) that leverage the higher exemption

Step 3: Maximize Annual Exclusion Gifts as Your Foundation Strategy

Annual exclusion gifts are the most underutilized wealth transfer tool in America. For 2025, you can gift $19,000 to any individual without filing a gift tax return or impacting your lifetime exemption. Married couples double this to $38,000 per recipient.

The power multiplies over time. A married couple with three children and six grandchildren can transfer $342,000 annually ($38,000 × 9 recipients) without touching their lifetime exemption. Over 10 years, that's $3.42 million in tax-free wealth transfer: plus all future appreciation on those gifted assets.

According to IRS Publication 559, these gifts also provide additional benefits beyond the immediate transfer:

• Remove assets from your taxable estate permanently

• Shift future appreciation to beneficiaries

• Reduce potential estate tax liability without depleting exemptions

• Create a systematic wealth transfer structure

Advanced annual exclusion strategies:

• Gifts to 529 education savings plans (can front-load 5 years of exclusions)

• Payments directly to medical providers or educational institutions (unlimited exclusion)

• Gifts of discounted valuations through family limited partnerships

Step 4: Deploy Advanced Tax-Efficient Strategies for Maximum Impact

With permanent higher exemptions now established, sophisticated wealth transfer strategies are experiencing a renaissance. The certainty around $15 million exemptions allows for more aggressive planning without sunset deadline pressures.

Spousal Lifetime Access Trusts (SLATs) allow you to use your exemption while maintaining indirect access through your spouse. Grantor Retained Annuity Trusts (GRATs) let you transfer appreciation while retaining income streams. Irrevocable Life Insurance Trusts (ILITs) remove life insurance proceeds from your taxable estate entirely.

Dynasty trusts become particularly powerful under the new permanent structure, enabling multi-generational wealth transfer while minimizing taxes across generations. According to Treasury regulations, these trusts can now be funded with significantly larger amounts while remaining below estate tax thresholds.

Don't overlook the step-up in basis advantage. The OBBBA maintained this critical benefit: assets passed through your estate receive a stepped-up cost basis, eliminating built-in capital gains entirely. For clients holding highly appreciated stock or real estate, a strategic "hold until step-up" approach can eliminate capital gains without triggering estate tax concerns for estates under $15 million.

Step 5: Build Flexibility Mechanisms for Future Legislative Changes

"Permanent" in tax law means permanent until Congress changes it. Smart estate planning incorporates flexibility mechanisms that allow adjustments as circumstances and laws evolve.

Trust decanting provisions allow modification of trust terms to adapt to changed circumstances. Trust protector powers enable a designated person to make adjustments to trust provisions without court involvement. According to guidance from the American College of Trust and Estate Counsel, these flexibility tools have become essential in modern estate planning.

Essential flexibility mechanisms include:

• Distribution committee powers to adjust beneficiary allocations

• Investment committee authority to modify investment strategies

• Trust protector powers to modify administrative provisions

• Decanting provisions to update trust terms for changed laws

Schedule regular plan reviews every three years or after major life changes. Even with permanent exemptions, your family situation, wealth level, and tax law landscape will continue evolving. Proactive monitoring ensures your strategy remains aligned with both your goals and the legal environment.

Your Next Steps: Don't Let This Opportunity Slip Away

The combination of permanently higher exemptions, inflation adjustments starting in 2027, and removal of sunset dates creates the most favorable estate planning environment in decades. However, political winds can shift quickly: what one Congress enacts, another can modify.

The families who act now will lock in generational wealth protection at today's favorable rates. Those who wait risk future legislative changes that could significantly reduce these benefits.

Ready to secure your family's financial legacy? The complexity of modern estate planning requires expert guidance to navigate the intersection of federal tax law, state regulations, and family dynamics. Our team specializes in sophisticated wealth transfer strategies that maximize the OBBBA's benefits while building in flexibility for whatever comes next.

Book a strategic estate planning consultation with our team to review your current plan and develop a comprehensive strategy that protects your wealth for generations to come.