Estate Planning Considerations in Light of the OBBBA
- Davies Law Office
- Jul 21
- 2 min read
On July 4, 2025, the One Big Beautiful Bill Act (OBBBA), was signed into law. How does this new law affect you and your estate plan? Below are the highlights of the OBBBA:
Estate and Gift Tax Exemptions. The estate and gift tax exemption amounts is permanently increasing to $15,000,000 per individual, and $30,000,000 for married couples (with proper planning). This amount will be adjusted annually based on inflation.
Please note that if you are a Washington resident, the Washington State Estate Exemption amount is $3,000,000 per individual, and $6,000,000 for married couples (with proper planning). For more details on this change please be sure to check out the following article: Big Changes to Washington State Estate Tax: What You Need to Know in 2025.
Portability. There are no changes to the rules on Portability elections. In a nutshell, the portability election rules allow the surviving spouse to "port over" the deceased spouse's unused exemption amounts to the surviving spouse.
Generation-Skipping Transfers. The lifetime generation-skipping transfer (GST) tax exemption will continue to be equal to the estate tax exemption amount. The GST tax applies when an individual transfers assets to a "skip" generation. For example, grandparent transfers assets to grandchild. Remember, however, there is an exemption, so no taxes are owing until you have transferred at least $15,000,000 ($30,000,000 if married).
Other OBBBA provisions that may interest you:
Tax Brackets. The current tax brackets, with a base rate of 10% and a top rate of 37%, have been made permanent.
Deductions. There are changes to deduction amounts. Below are the most common ones:
The standard deduction will increase to $15,750 for individuals ($31,500 for married couples filing jointly).
The home mortgage interest deduction is limited to interest on mortgage debt of up to $750,000 on primary and secondary residences.
The state and local tax (SALT) deduction has been increased to $40,000 (will revert back to $10,000 in 2030).
If you want to know how the OBBBA affects your specific estate plan, please call Davies Law Office at 425-440-3494 or email us at office@dlolawgroup.com to schedule a consultation with one of our attorneys.
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