United States sets permanent $15 million inheritance tax exemption

The United States has permanently set its federal inheritance tax exemption at $15 million per individual, or $30 million for a married couple, following the signing of the ‘One Big Beautiful Bill Act’ on July 4, 2025. This legislation removes the previous expiration date that would have seen the exemption drop to approximately $7 million on January 1, 2026.

This new threshold, which will be adjusted annually for inflation, represents the highest level in the history of American inheritance tax. For comparison, the exemption stood at $5.49 million prior to 2017. The law also allows for transfers directly to grandchildren to bypass an entire generation without triggering the tax, provided they remain within the exemption limits.

While the exemption is high, amounts exceeding the limit remain subject to a 40% tax rate. Additionally, the annual gift tax exclusion per recipient is set at $19,000 for 2026. Analysts at Cerulli Associates estimate that $124 trillion in wealth will change hands in the United States by the year 2048.