For the past several years, high-net-worth families have felt like they were strapped into a roller coaster when it comes to federal estate tax law.

The original Tax Cuts and Jobs Act (TCJA) dramatically increased the federal estate and gift tax exemption, creating an unprecedented opportunity to transfer wealth tax-free. But that opportunity came with a looming drop: a built-in “sunset” provision that would have cut the exemption roughly in half on December 31, 2025.

Estate planners prepared for a sharp descent. Families evaluated accelerated gifting strategies. Advisors warned that waiting could be costly.

Then Congress intervened.

With the passage of the One Big Beautiful Bill Act (OBBBA), the anticipated plunge did not occur. Instead, the federal lifetime estate and gift tax exemption was set at $15 million per person beginning in 2026, or roughly $30 million for a properly structured married couple. The exemption will continue to be indexed for inflation.

For many families, that felt like the ride was smoothing out. But seasoned estate planning professionals know better than to unbuckle.

As Brittany Sloan of B Sloan Law notes, “Federal estate tax law has proven to be anything but stable. Exemptions rise. They fall. They sunset. They are extended. They are revised. Political shifts can quickly change the landscape again.”

For Houston-area families with significant assets, this period of estate tax whiplash is not a reason to pause planning. It is a reason to refine it and to look beyond the headlines toward long-term strategy.

The Illusion of Permanence

The current federal estate tax rate remains at 40 percent on assets above the exemption. That rate has held steady since 2013, down from 55% in 2001 and as high as 77% historically.

What has changed repeatedly is the exemption amount itself.

Over the past 25 years, the federal exemption has:

• Dropped as low as $675,000.
• Gradually increased into the millions.
• Been temporarily doubled under the TCJA.
• Faced a scheduled sunset.
• Then been revised again through subsequent legislation.

While the current $15 million exemption per person (or $30 million for married couples with proper planning) feels substantial, Congress can revisit it at any time. A shift in political control, mounting budget pressures, or broader tax reform could once again reduce the exemption dramatically.

Estate planning built solely around today’s numbers may not age well.

Why Waiting Can Be Costly

Some families now feel comfortable postponing estate planning because the exemption is “high enough.”

But sophisticated planning is rarely about reacting to a crisis. It is about maintaining flexibility.

Consider what happens if:

• The exemption drops under a future administration.
• Asset values continue to appreciate significantly.
• A closely held business experiences a liquidity event.
• Real estate markets in Houston and beyond continue climbing.

If your estate grows beyond the exemption at a future reduced level, your heirs could face a 40% federal tax on the excess, potentially millions in avoidable transfer tax.

The families who benefit most from high exemptions are those who use them deliberately, not those who assume they will always be available.

The Opportunity Window Is Still Open

Although the anticipated 2025 sunset did not occur, the current exemption remains historically high. That creates a meaningful planning window for families who want to act strategically rather than react defensively.

The question is not whether Congress removed the deadline. The question is whether you are positioned to use today’s exemption efficiently while it exists.

For high-net-worth Houston-area families, several strategies deserve renewed attention.

Strategic Lifetime Gifting

Using a lifetime exemption today removes not only the transferred asset from your taxable estate, but also all future appreciation on that asset.

If a $5 million asset transferred today grows to $10 million over time, that additional $5 million escapes estate taxation. At a 40% federal rate, that represents a potential $2 million tax difference for your heirs.

When exemptions are elevated, the leverage effect of lifetime gifting becomes more powerful.

Spousal Lifetime Access Trusts (SLATs)

Married couples often hesitate to make large lifetime gifts because of concerns about losing access to transferred wealth.

Spousal Lifetime Access Trusts can provide a structured solution. One spouse creates an irrevocable trust for the benefit of the other spouse and future generations. This allows the couple to use the exemption strategically while maintaining indirect access to assets during their lifetimes.

When designed properly, SLATs offer flexibility without sacrificing tax efficiency. However, they require careful consideration. If the beneficiary spouse predeceases the grantor spouse, indirect access to trust assets is lost. In the event of divorce, access is similarly eliminated. Coordinating dual SLATs between spouses must also be handled cautiously to avoid triggering the reciprocal trust doctrine. Proper drafting and planning are essential to achieving the intended result. 

Grantor Trust Planning

Grantor trusts remain a cornerstone of advanced estate planning.

These structures allow future asset growth to occur outside the taxable estate while the grantor continues paying income taxes on trust earnings. That tax payment effectively becomes an additional wealth transfer to beneficiaries without using an additional exemption.

In a volatile legislative environment, freezing asset values inside the estate while shifting appreciation outward can be particularly valuable.

Business and Real Estate Succession Planning

Houston families frequently hold:

• Closely held businesses.
• Commercial real estate portfolios.
• Energy and mineral interests.
• Private equity and investment partnerships.

These assets often appreciate quickly and may lack liquidity.

Using the current exemption in coordination with valuation strategies, family limited partnerships, or structured succession planning can reduce future estate tax exposure while preserving operational continuity.

When planning is proactive, families avoid forced sales or liquidity pressure at death.

Planning for Flexibility, Not Headlines

The goal is not to rush into transactions based on political noise. It is to structure plans that can adapt.

Well-drafted estate planning documents can incorporate formula provisions, trust flexibility, and powers of appointment that respond to future exemption changes.

“Rather than trying to predict the next legislative turn, sophisticated families prepare for multiple outcomes,” advises Brittany Sloan of B Sloan Law. “Do not simply follow estate law. Anticipate it.”

High exemption levels provide an opportunity. Legislative uncertainty provides motivation. Together, they create a strategic moment.

A Strategic Review for 2026 and Beyond

For many Houston-area families, estate plans were drafted or updated during the uncertainty surrounding the anticipated 2025 sunset. Others may have paused planning altogether, waiting to see how Congress would act.

Now that the immediate deadline has been eliminated, this is an ideal time to reassess.

If your estate plan has not been reviewed in the past two to three years, it may not fully reflect current exemption levels, asset valuations, or evolving family goals. If your net worth is approaching or exceeds eight figures, proactive coordination between your legal, tax, and financial advisors is essential.

Estate planning is not about reacting to headlines. It is about building a structure that can withstand legislative change, market volatility, and generational transition.

As Brittany Sloan emphasizes, thoughtful planning is not driven by panic or politics. It is driven by preparation.

For families who want clarity, now is the time to evaluate whether your current plan is positioned not just for today’s law, but for whatever Congress does next. Contact B Sloan Law today for help in protecting the people you care about.