Big News for Your Estate Plan: New Tax Law Signed into Effect
On July 4, 2025, the One Big Beautiful Bill Act was signed into law, permanently altering the tax landscape for families, business owners, and legacy planners. At Von Rock Law, we’re breaking down what this means in plain language—so you can make confident decisions.
💼 Estate & Gift Tax Exemption Increases to $15 Million in 2026
One of the most significant updates is the permanent increase in the estate and gift tax exemption:
- 2025: The exemption remains at $13.99 million per person
- Starting 2026: The exemption increases to $15 million per person (or $30 million for married couples), with annual inflation adjustments
This increase gives families greater flexibility to transfer wealth without triggering federal estate or gift tax.
Pro Tip: If you’ve already used most of your current exemption, the new law resets the opportunity to make additional gifts beginning January 1, 2026.
👨👩👧👦 Generation-Skipping Transfer (GST) Tax Exemption Also Increases
The GST exemption—used to transfer assets to grandchildren or other non-immediate descendants—will also rise to $15 million in 2026, aligned with the estate tax exemption.
Why it matters: Families using dynasty trusts or long-term planning strategies should revisit their allocations.
🏡 SALT Deduction Restored for Many Taxpayers
The State and Local Tax (SALT) deduction cap has been raised:
- New cap: $40,000, up from $10,000
- Applies to 2025–2029
- Begins phasing out for ultra-high earners
For many California residents, this means a larger federal deduction and the potential for meaningful income tax savings.
📈 Permanent 20% Deduction for Pass-Through Business Income
Business owners rejoice: the Qualified Business Income (QBI) deduction is now permanent.
- Applies to income from LLCs, S Corporations, sole proprietorships, and partnerships
- No longer subject to sunset under previous tax law
Strategic Tip: This makes it even more important to evaluate your entity structure and ensure your estate plan accounts for business succession and tax optimization.
🧓 Seniors Get an Additional Deduction
Taxpayers age 65+ now qualify for a new $6,000 standard deduction bonus, beginning in 2025 (with some income restrictions).
This benefit will remain in effect through 2028, offering relief to seniors on fixed incomes and streamlining their annual filing process.
📅 What Should You Do Now?
The good news is: you don’t need to rush. But you do need a strategy.
Whether you want to:
- Take advantage of your 2025 gifting window
- Revisit outdated trusts or tax plans
- Prepare for additional wealth transfer starting in 2026
- Coordinate estate and business planning
Von Rock Law is here to help you navigate these updates with clarity and care.
💬 Ready to Review or Start Your Plan?
Our award-winning estate planning team is available for consultations by phone or in person. We offer flat-fee pricing, modern tools, and a people-first approach to planning for what matters most.
📍 Serving California families, business owners, and legacy-minded clients
📞 Call us at 866-720-0195
📧 Email: welcome@vonrocklaw.com
This blog is made available by Von Rock Law, PC for informational purposes only and is not intended to provide legal advice. The information contained herein may not reflect the most current legal developments and may not apply to your specific circumstances. Viewing this website, reading this blog, or communicating with our firm through this site does not create an attorney-client relationship. You should not act upon any information contained in this blog without seeking professional counsel from an attorney licensed in your jurisdiction. Unless otherwise expressly stated, our attorneys are licensed to practice law only in the State of California. Prior results do not guarantee a similar outcome.
