The "One Big Beautiful Bill Act”: Key Figures for NY Taxpayers
Starting January 1st, 2026, the federal estate, gift, and Generation Skipping Transfer exemption jumps to $15 million per person/ $30 million per married couple.
The previously planned "sunset" drops in the exemption, planned for January of 2026, has been terminated. The top federal tax rate remains at 40%.
Portability between spouses remains, allowing spouses to use their deceased spouses unused exemption amount for their own exemption. (For NY rules, look in the section below)
The Annual gift Tax Exclusion remains at $19,000 per person, meaning you can gift annually over time (to anyone, tax free) to reduce your estate tax amount.
To combat any of these issues, it is wise to consider wealth planning to game plan strategies to reduce your overall estate figures.
Charitable Trust
Qualified Personal Residence Trust (QPRT)
Grantor Retained Annuity Trust (GRAT)
Credit Shelter Trust
What About New York State:
New York State also has custom rules that differ from the Federal side.
These rules tend to make Estate Planning for State taxes trickier.
The New York State Exemption sits at $7.16 Million/individual for the remainder of 2025. Along with inflation, the new annual figure for 2026 is yet to be determined, though should remain similar.
The top tax rates sit at 16%.
At the state level, there is no portability between spouses. This means you cannot use our spouses' exemption for yourself.
At the state level, there is a special "3-year gift add back" rule. This means gifts made within 3 years of death are added back to your estate.
Lastly, and very importantly, New York State implements an "Estate Tax Cliff," which taxes the entire estate if the estate figure climbs above 105% of the exclusion.
This document is designed for general information only. The information presented in this document should not be construed to be formal legal or tax advice nor the formation of a lawyer/client relationship.
For more information on this and other topics, please contact Kevin via any of the channels listed below:
📧 kevin@kmckernan.com | 📞 718-317-5007