On July 4, 2025, H.R.1, the One Big Beautiful Bill Act (OBBBA), became law with significant implications for estate planning. While this legislation has generated considerable discussion and contains provisions with varying impacts across different populations, one key development stands out for high-net-worth families: the permanent estate and gift tax exemption. At REDW, our focus remains on helping clients understand and navigate the specific planning opportunities this stability creates.
For families with substantial assets—particularly those with $25 million or more in combined business interests, real estate, and investments—this regulatory certainty opens the door to sophisticated wealth transfer strategies that can preserve millions of dollars for future generations or charitable causes.
How H.R.1 (OBBBA) Changed the Estate Planning Landscape
Since the passage of H.R.1 (OBBBA), the larger estate and gift tax exemption is now permanent. That stability has given our clients more clarity, but the need for sophisticated planning remains as important as ever. The right strategies can preserve millions of dollars and keep wealth in your family or with the causes you care most about.
In our previous analysis of H.R.1’s estate planning changes, we covered the fundamental shifts in exemption amounts and trust rules. Now, let’s explore four specific strategies that take advantage of these new parameters to maximize your family’s wealth preservation opportunities.
Strategy 1: Maximize Tax Savings Through Charitable Stock Donations
Here’s where strategic charitable giving becomes powerful. Let’s walk through a real-world scenario that shows the impact.
Consider a business owner with $10 million of income in a single year due to the sale of a company. This client also holds $5 million of publicly traded stock purchased years ago for only $500,000. If you’re in a similar situation, donating the stock directly to a qualified charity instead of selling it creates two significant benefits.
First, you avoid paying capital gains entirely. The $4.5 million of appreciation would have created a tax bill of more than $1 million if sold. By donating instead of selling, that tax disappears.
Second, you receive a charitable deduction equal to the fair market value of the stock, subject to the 30 percent of adjusted gross income limit for appreciated property. With $10 million of AGI, you can deduct $3 million of the stock gift in the current year, saving about $1.1 million in income taxes at a 37 percent bracket. The remaining $2 million of unused deduction carries forward for up to five years.
The bottom line: By structuring the gift strategically, you achieve both philanthropic impact and combined federal tax savings well in excess of $2 million. At REDW, we walk you through these calculations, confirm limits, and ensure every deduction is substantiated with the right documentation.
Strategy 2: Eliminate Generation-Skipping Transfer Tax with Proper Planning
The generation-skipping transfer tax represents one of the most overlooked—and costly— mistakes in estate planning. This separate 40 percent tax applies when wealth moves to grandchildren or later generations, unless exemption is allocated.
Here’s what this looks like in practice: Imagine you’re funding a $10 million trust for your grandchildren. Without allocating GST exemption, distributions to grandchildren could eventually trigger a $4 million GST tax. However, with proper exemption allocation when the trust is funded, that same $10 million can pass to grandchildren, great-grandchildren, and beyond entirely free of GST tax.
The opportunity compounds over time as the trust grows. What starts as a $4 million tax savings can become much larger as the trust assets appreciate over decades.
At REDW, we prepare the allocation filings, monitor inclusion ratios, and ensure that trust provisions align with your long-term GST plan. This isn’t something you want to handle as an afterthought.
Strategy 3: Lock in Lifetime Exemptions Before Future Growth
Even with the exemption stabilized under H.R.1 (OBBBA), lifetime gifting remains one of the most powerful wealth transfer strategies available to high-net-worth families.
Here’s the concept: A couple with a $30 million estate might choose to transfer $20 million into trusts during their lifetimes. This uses part of their exemption but also removes all future growth on the $20 million from their estate.
The math is compelling. If those assets appreciate at six percent annually, the growth is more than $1.2 million each year, none of which will be subject to estate tax at death. Over time, the compounded savings can be extraordinary.
At REDW, we help you navigate the critical decisions: How much should you gift? What’s the impact on your lifestyle needs? How can we structure trusts that provide flexibility through mechanisms such as spousal access trusts?
These aren’t just technical questions. They’re deeply personal decisions that affect your family’s financial security and legacy goals.
Strategy 4: Create Liquidity Solutions for Asset-Rich, Cash-Poor Estates
For families whose wealth is concentrated in illiquid assets like closely held businesses, farms, or real estate, the challenge isn’t just the amount of estate tax owed but how to pay it without selling assets under pressure.
Life insurance planning provides the needed liquidity. Consider a business owner with a $25 million estate, including $20 million in company stock and real estate. At death, the estate may face a $4 million federal estate tax bill but have little cash available to pay it.
By creating an irrevocable life insurance trust that owns a $4 million second-to-die life insurance policy, the family ensures that the necessary cash is available to pay the tax without liquidating assets. This protects the continuity of the business and preserves family wealth.
At REDW, we evaluate your liquidity needs, coordinate with insurance professionals, and ensure that the structure integrates seamlessly with your overall estate plan. The key is planning while you’re healthy and insurability isn’t a concern.
REDW’s Integrated Approach: Beyond Tax Preparation to Strategic Planning
What distinguishes REDW is the way our team combines technical expertise with a client-first approach. We do more than prepare Forms 706, 709, and 1041. We run projections that show you the actual dollar differences between donating stock and selling it, between allocating GST exemption and leaving it unused, and between planning lifetime gifts and waiting until death.
We also work closely with your attorneys to ensure that the tax plan and legal documents are perfectly aligned. This collaborative approach gives our clients clarity, confidence, and measurable results.
Your Next Steps: Making the Most of OBBBA’s Opportunities
The stability provided by H.R.1 (OBBBA) creates a unique window for strategic estate planning, but the opportunities require expert guidance to implement correctly. At REDW, we combine deep technical expertise with personalized service to help high-net-worth families navigate these complex strategies.
Whether through charitable giving, GST allocations, lifetime transfers, or insurance strategies, we ensure that you make the most of your opportunities. As we look ahead to 2026 and beyond, our focus is on delivering strategies that protect wealth, support your family goals, and provide lasting value.
Ready to explore how these approaches could benefit your family’s wealth transfer goals? Contact our estate planning specialists for a confidential consultation, or learn more about our comprehensive tax planning services. Let’s frame your family’s financial future together.
