Estate‑Planning Playbook
Estate prompts shared publicly recommend GRATs, ILITs and planning ahead of the 2026 exemption sunset for UHNW families—practical tools for minimizing estate tax and transferring wealth. Those tactics are high‑value conversation triggers for HNW clients and centers of influence. (x.com)
President Biden’s signature is inaccurate here: the One, Big, Beautiful Bill Act was signed into law on July 4, 2025 as Public Law 119‑21. (irs.gov/newsroom/one-big-beautiful-bill-provisions) The statute sets the federal basic exclusion (BEA) for estates of decedents dying in 2026 at $15,000,000 per individual, up from $13,990,000 in 2025. (irs.gov/newsroom/irs-releases-tax-inflation-adjustments-for-tax-year-2026-including-amendments-from-the-one-big-beautiful-bill) For married couples who elect portability, the unified lifetime exclusion effectively doubles to $30,000,000 under the new law as summarized by major tax firms. (kpmg.com/content/dam/kpmg/taxnewsflash/pdf/2025/05/kpmg-report-egt-one-big-beautiful-bill-may-15-2025.pdf) The federal tentative estate tax schedule and top marginal rate remain in place, with pre-credit rates culminating in a 40% marginal tax on large taxable transfers. (natlawreview.com/article/2026-estate-and-gift-tax-update) Tax-industry coverage flagged a material demand shift for large life‑insurance placements: analyses say many ultra‑wealthy buyers no longer need new policies solely for federal estate‑tax liquidity and advisors are being asked to reassess existing high‑face policies. (news.bloombergtax.com/tax-management-memo/obbba-changes-how-high-net-worth-clients-use-life-insurance ) (fa-mag.com/news/don-t-ignore-how-new-law-changes-life-insurance-planning--experts-warn-83729.html) Valuation rules still govern annuity‑style trusts: the IRS’s Section 7520 interest rate (120% of the federal mid‑term rate, rounded) is used to value retained annuity interests and directly affects how much appreciation can be shifted off an estate. (irs.gov/businesses/small-businesses-self-employed/section-7520-interest-rates) Market rates matter now that the Section 7520 for March 2026 was 4.8%; practitioners note lower 7520 rates make annuity‑transfer techniques more likely to move post‑transfer appreciation to beneficiaries. (eidebailly.com/insights/blogs/2026/2/202603-afr ) (corient.com/us/en/insights/articles/grats-shift-appreciation-preserve-exemption) The IRS also preserved a 2019 special‑rule protection for earlier gifting: gifts made during 2018–2025 won’t be penalized if BEA levels change later, because an estate can use the greater exclusion applicable to gifts already made when computing the estate tax credit. (irs.gov/newsroom/estate-and-gift-tax-faqs) Federal clarity doesn’t erase state exposure: 12 states plus the District of Columbia still impose state estate taxes with much lower thresholds than the federal BEA, meaning state rules remain a common source of taxable estates. (taxfoundation.org/datamaps/state-estate-inheritance-taxes)
