Estate Tax Exemption Rises to 15 Million Per Person as New Retirement Rules Take Effect
The estate tax exemption increased to $15 million per person for 2026 under the One Big Beautiful Bill Act. Higher-income workers aged 50 and older must now direct catch-up retirement contributions into Roth-style accounts. Financial planners say the changes create new opportunities for wealth transfer and long-term tax planning.
The estate tax exemption rose to $15 million per person for 2026 under the One Big Beautiful Bill Act, creating new opportunities for wealth transfer planning for high-net-worth families.
The change means married couples can now shield up to $30 million from federal estate taxes. Financial planners say the increase gives families more flexibility to pass assets to heirs without triggering large tax bills.
The same legislation introduced new rules for retirement catch-up contributions. Higher-income workers aged 50 and older must now direct catch-up contributions into Roth-style accounts rather than traditional pre-tax accounts. The change means those contributions will be taxed now but grow tax-free.
Financial advisors say the Roth requirement affects workers earning above a certain income threshold and may require adjustments to existing retirement strategies. Workers in this category should review their contribution elections with a financial planner.
The IRS also increased standard mileage rates for the second half of 2026 to account for higher fuel prices tied to elevated energy costs.
Surveys show Americans estimate they need $1.2 million for retirement but expect to fall short of that goal. Experts recommend aligning liquidity and growth assets with specific time horizons as the most reliable way to navigate the current high-rate, high-inflation environment.
