2026 Estate Tax Update

While married U.S. citizens may still gift unlimited sums of money to each other during life and after death, gifts outside of the marriage, such as those to children or other family members, may result in tax consequences if such gifts exceed specified amounts. Though subject to change if new legislation is enacted in the future, the below items highlight the landscape of federal estate and gift tax law as of January 1, 2026:

• The lifetime exclusion amount for federal gift and estate taxes for the year 2026 increases to $15 million per person (up from $13.99 million in 2025), or $30 million for a U.S. married couple. With the passage of the One Big Beautiful Bill Act, this exclusion amount is now permanent and will be indexed annually for inflation.

• The federal lifetime exclusion amount remains “portable,” meaning an individual’s unused exclusion amount transfers to his or her surviving spouse if the proper election is made on the decedent’s estate tax return. This election must be made within a limited time window after the deceased spouse’s death.

• The annual federal gift exclusion amount remains at $19,000 per person, or $38,000 for a married couple.

• The highest federal estate tax, gift tax, and GST tax rate remains stable at 40%.

See this piece from Forbes for more extensive discussion of current federal estate and gift tax law. Happy New Year!