As our nation celebrated its 249th birthday, President Trump signed the One Big Beautiful Bill Act (“OBBBA”) into law on July 4, 2025.Prior to the passage of the OBBBA, the “exclusion amount” for the Federal Estate Tax was scheduled to decrease by 50% in 2026. For individuals who die during the year of 2025, the exclusion amount is $13,990,000. If OBBBA had not been enacted, the exclusion amount would have been approximately $7,000,000 for any individuals who die in 2026. However, due to the enactment of the OBBBA, the exclusion amount for 2026 will be $15,000,000. This new amount will be increased every year after 2026 to reflect a cost-of-living adjustment. This exclusion amount also applies to the Federal Gift Tax and the Generation-Skipping Transfer Tax. If you utilized your entire gift tax exclusion amount of $13,990,000 in 2025, you will have an additional $1,110,000 exclusion amount to use in 2026 for gifting.For any taxable transfers in excess of the exclusion amount, the tax rate remains the same. The excess value of assets will be taxed at a rate of 40%.Additionally, the laws regarding the gift tax annual exclusion remain the same. The annual exclusion amount for 2025 is $19,000. Depending on inflation data generated toward the end of this year, the annual exclusion amount for 2025 will either remain at $19,000 or increase to $20,000.Advanced estate tax planning strategies (Grantor Retained Annuity Trusts (“GRATs”); Intentionally Defective Grantor Trusts (“IDGTs”); Irrevocable Life Insurance Trusts (“ILITs”); Spousal Lifetime Access Trusts (“SLATs”); Charitable Remainder Trusts (“CRATs” and “CRUTs”); Charitable Lead Trusts (“CLATs” and “CLUTs”)) are not substantially impacted by the changes from the OBBBA. These strategies will remain very valuable for anyone who is concerned about his or her estate being subject to the Federal Estate Tax upon death.Although federal taxes are an important factor for your personal estate plan, there are many other important factors that will not be affected by the OBBBA. Among other things, proper estate planning is important to ensure that (1) the Pennsylvania Inheritance Tax is minimized, (2) the inheritances of your beneficiaries are protected by creating reasonable trust structures, (3) the cost and time of probate proceedings are minimized, (4) your goals are executed efficiently by choosing the appropriate fiduciaries, and (5) government benefits provided to your beneficiaries are not negatively impacted due to the inheritances that you leave those beneficiaries. Each person’s estate plan should be customized to that person’s specific goals. Contact your personal estate planning attorney if you have any questions on how the OBBBA may impact your existing estate plan.