7 New Estate & Financial Planning Opportunities Under the OBBBA

When the One Big Beautiful Bill Act (OBBBA) was signed into law on July 4, 2025, it didn’t just change tax brackets and deductions — it reshaped the landscape for estate and long-term financial planning. For families, business owners, and retirees alike, the law creates one of the most favorable environments for transferring wealth in decades.

In this article, we’ll explore the provisions of the OBBBA that matter most for estate and financial planning, what they mean for high-net-worth families and everyday households, and the opportunities they unlock for securing your legacy.

Here are 7 estate and financial planning opportunities for 2026 under the One Big Beautiful Bill Act (OBBBA):

1. Increased estate and gift tax exemptions

2. Protection from capital gains taxes (step-up in basis)

3. Expanded options for seniors and families with children

4. New short and long-term financial strategy options

5. New estate planning strategies for high-net-worth families and business owners

6. New opportunities for working and middle-class families

7. Legal, tax and financial considerations surrounding these new opportunities

1. A Historic Increase in the Estate and Gift Tax Exemption

Starting in 2026, the exemption rises to $15 million per individual, or $30 million for married couples, with annual inflation indexing beginning in 2027. Unlike previous laws, this increase has no scheduled “sunset” date, providing estate planners more certainty.

What this means in practice:

• Families who previously maxed out their gifting exemptions now have new room to transfer wealth tax-free.

• Even after using the full exemption, inflation adjustments will add new opportunities each year.

• High-net-worth families can use these amounts strategically — forgiving outstanding loans, shifting ownership interests, or funding life insurance trusts.

2. No Change to the Step-Up in Basis

One of the more surprising elements of the OBBBA is what it didn’t change: the rules on “step-up in basis.” Heirs will still receive assets with their cost basis reset to the fair market value at the time of death.

Why this matters:

• This prevents heirs from being burdened with massive capital gains taxes.

• For families passing down real estate, businesses, or long-held stock portfolios, it preserves more wealth for future generations.

  
  

3. Expanded Options for Families and Seniors

Beyond estate taxes, the OBBBA introduced several family- and retirement-friendly changes:

• Dependent Care Assistance: Contributions rise from $5,000 to $7,500 starting in 2026.

• 529 Plans: Contribution limits double from $10,000 to $20,000 and now cover K–12 private education expenses.

• ABLE Accounts: Enhanced contribution provisions for individuals with disabilities were made permanent.

• “Trump Accounts” for Minors: A new IRA-like savings vehicle for children under 18, with $5,000 annual contributions and $1,000 government seed contributions.

• Senior Deduction: A new above-the-line $6,000 deduction for taxpayers 65 and older (phasing out at $75,000 single / $150,000 joint AGI) for tax years 2025–2028.

4. The Power of Timing and Gifting

The temporary nature of some deductions contrasts with the permanence of the estate exemption increase.

This creates two distinct planning paths:

1. Short-term moves — Taking advantage of temporary deductions before they expire in 2028.

2. Long-term strategies — Leveraging the exemption increase to secure multigenerational wealth transfer.

For example, a business owner might use the expanded exemption to transfer shares in a family company, while grandparents could use new 529 and “Trump Account” opportunities to seed wealth for children and grandchildren.

5. Estate Planning Strategies for High-Net-Worth Families

Here are three strategies that will gain traction under the OBBBA:

1. Loan Forgiveness: Families with existing intra-family loans or private split-dollar life insurance arrangements may forgive debt equal to new exemption amounts.

2. Business Succession Planning: Larger ownership stakes can be transferred without triggering gift tax.

3. Irrevocable Life Insurance Trusts (ILITs): Annual inflation-adjusted exemptions can fund ILIT premiums tax-free.

6. Why Everyday Families Should Care About the OBBBA Too

It might sound like these provisions only benefit billionaires, but everyday households stand to gain:

• 529 Plan Expansion helps parents saving for education.

• Dependent Care Increase supports families with aging parents or disabled children.

• Trump Accounts build long-term wealth for children with modest contributions.

7. Risks and Considerations

No law is without complexity:

• Political risk: While the exemption increase is permanent under the law, it could be rolled back by a future administration.

• Complexity: Larger gifts require careful documentation and professional coordination.

• Liquidity issues: Families who gift away business interests or real estate may reduce flexibility if not carefully structured.

Conclusion: A Window of Opportunity

The OBBBA creates a once-in-a-generation opportunity to transfer wealth, support family goals, and reduce future tax exposure. By raising the estate exemption, expanding education and dependent benefits, and leaving step-up in basis untouched, the law sets the stage for families to secure their financial legacy more effectively than ever before.

But the window won’t stay open forever. Help your clients act now by reviewing gifting strategies, and exploring trusts and savings vehicles — to make the most of the new rules.