re: Estate Tax Insurance

Estate tax exemption under the TCJA is $11.18 million per person indexed annually for inflation. This setup is going to sunset at the end of 2025. In 2026, we go back to ATRA levels with the understanding that the $5 million exemption amount has been indexing annually since 2011. Our best guess is that indexed amount will be between $6-7 million in 2026. Portability was enacted under the ATRA and remains in place under the TCJA.

All that being said, a married couple doesn’t have to worry about fed estate tax if they are under $22.2 million today through 2025. In 2026 and beyond, there is a potential estate tax if the couple is over $13 million due to the sunset. The caveat is that a new administration can always change it.

FWIW, I was an EP attorney in private practice for HNW clients before going in house to plan for UHNW clients.