Deciphering the Impact of Trump’s Megabill on Estate Tax and Wealth Accumulation

Do you know how legislative changes could impact your estate? The tax and spending megabill signed by President Trump in 2025 brought about significant shifts in estate tax law. It cut nearly $200 billion from food assistance, while providing an equal amount as an estate tax cut to a few thousand people leaving over $7 million to their heirs. The new law increased the estate tax exemption to $15 million for single people and $30 million for couples in 2026. In essence, a couple can leave nearly $30 million to their heirs without paying any estate tax in 2026. This is seen as a continuation of efforts to weaken a crucial tool designed to prevent wealth hoarding across generations. Rewind to 2001, the individual estate tax exemption was $675,000, which when adjusted for inflation, equals around $1.2 million today. Yet, it was paid by only 2.14% of all estates. Since then, the estate tax has been weakened four times, most significantly by the 2017 Trump tax law which doubled the estate tax exemption to about $14 million today. Keep in mind that these changes could affect your estate planning strategy. It’s crucial to stay informed and adapt to ensure your wealth is distributed according to your wishes.

Source: itep.org