For 2026, the federal estate and gift tax exemption is $15 million per person, or $30 million for a married couple, up from $13.99 million in 2025. The One Big Beautiful Bill Act made the higher exemption permanent and indexed it to inflation. Separately, the annual gift exclusion stays at $19,000 per recipient.
If you have heard people mention a “new $15 million tax rule” and felt a little lost, don’t worry: this guide breaks it down in plain English, starting from the very basics.
Tax headlines can be confusing, especially when the numbers involved sound like they belong to someone else’s life. But 2026 brought one of the biggest changes to estate and gift tax rules in years, and it is worth understanding, whether you are a business owner, a parent thinking ahead or just curious what all the buzz is about.
Let’s start simple. In the U.S., there are two related taxes that only apply to very large amounts of money:
The good news? Almost nobody actually pays these taxes. That is because the government allows you to give away or leave behind a certain amount of money completely tax-free. This tax-free amount is called your exemption (also called an exclusion).
Only the amount above your exemption could ever be taxed. And starting in 2026, that exemption got a lot bigger.
Here is the headline: the estate and gift tax exemption is now $15 million per person for 2026. That means:
The change came from the One Big Beautiful Bill Act (OBBBA), signed in 2025. Before this law passed, many people expected the exemption to shrink back to around $7 million starting in 2026. Instead, Congress went the opposite direction and made the higher exemption permanent, while also increasing it.
The most important thing to understand: this only matters if your estate (everything you own) is worth more than $15 million, or $30 million for a married couple.
For the vast majority of people, the change does not mean anything different day to day: they were never going to owe estate or gift tax anyway. The topic mainly matters for:
Separate from the $15 million lifetime exemption, there is also an annual gift exclusion: the amount you can give to any one person each year with zero paperwork and zero impact on your lifetime exemption.
For 2026, the annual gift exclusion stays at $19,000 per person (unchanged from 2025). A married couple can combine theirs to give $38,000 per person per year.
For example, if you and your spouse each give your child $19,000 in 2026, that is $38,000 in total, completely tax-free, with no forms required, and it does not touch your $15 million lifetime exemption at all.
One important exception: if you are giving to a spouse who is not a U.S. citizen, the annual limit is different. It is rising to $194,000 in 2026 (up from $190,000 in 2025).
Think of your $15 million exemption as one shared “bucket” that covers both gifts made during your life and anything you leave behind when you die. Every time you give more than the $19,000 annual exclusion to one person, the extra amount comes out of that $15 million bucket. It is not a tax bill, just a reduction of your remaining tax-free allowance.
Example: say you gift $3 million to your child in 2026. That $3 million (above the small annual exclusion) reduces your remaining lifetime exemption to $12 million. If you later pass away, only that remaining $12 million would be shielded from estate tax; anything beyond it could be taxed.
If your gifts to one person in a year go over the $19,000 annual exclusion, you (the person giving the gift) are responsible for filing a gift tax return (Form 709). The person receiving the gift never owes tax on it or has to report it as income.
You may see the word “permanent” used a lot around this change, and it is true: this exemption does not have a built-in expiration date the way past versions did. It will also continue to adjust upward each year for inflation.
That said, tax law can always change if Congress passes new legislation. “Permanent” means there is no scheduled sunset date, not that the number can never be revisited in future years.
If your estate is well under $15 million (or $30 million as a couple), this change is mostly good news to be aware of, but it does not require any action.
If you are close to or above those thresholds, this is a good moment to review your estate plan with a tax professional or estate planning attorney, especially if you have made large gifts in previous years or are considering passing down a business or major assets.
The $15 million exemption ($30 million for married couples) is genuinely good news for most families: it means far more room to pass down wealth without triggering federal estate or gift tax. But “good news” does not mean “no planning needed.” Tax law can shift again in future years, and even with a permanent exemption, how you structure gifts, business transfers or cross-border assets still makes a real difference in what your family keeps.
This is where Orbiss comes in. Whether you are a growing business owner, a founder with cross-border assets or a family navigating international tax exposure, our private client tax team can help you understand how these exemption changes apply to your situation and keep your planning in step with the rules. Get in touch to talk it through.
$15 million per person. A married couple can combine their exemptions to shield up to $30 million. In 2025 the exemption was $13.99 million per person.
$19,000 per recipient, unchanged from 2025. A married couple can give $38,000 per recipient per year. For gifts to a spouse who is not a U.S. citizen, the annual limit is $194,000 in 2026.
Only if your gifts to one person in a year exceed the $19,000 annual exclusion. In that case the person giving the gift files Form 709. The person receiving the gift never owes tax on it or reports it as income.
Gifts above the annual exclusion reduce your remaining lifetime exemption. For example, a $3 million gift in 2026 leaves $12 million of exemption to shield your estate later.
The One Big Beautiful Bill Act removed the scheduled expiration date and indexes the exemption to inflation. Congress can still change it through new legislation in the future.
This article is for general informational purposes only and does not constitute legal, tax, or accounting advice. Rules and requirements vary by company, individual, and jurisdiction, and can change. Please seek advice appropriate to your specific situation.