Meet the Estate Tax & Gifting Planner: The $15M Question Nobody Talks About

The federal estate tax exemption is $15 million per person ($30 million per married couple) in 2026 — raised from $13.99 million by the One Big Beautiful Bill Act of 2025. That sounds like a problem for someone else — until you realize that a $15 million estate can sneak up on a successful small-business owner or a family that bought a house decades ago in an appreciating market.

And even if you're below the federal threshold, 17 states have their own estate or inheritance taxes with much lower exemptions — some as low as $1 million.

Alistair's Estate Tax & Gifting Planner shows your exposure at both levels and calculates how much you can gift annually to reduce it.

How It Works

Estate Tax Calculation

The tool takes your total assets, total liabilities, annual gifting, and whether a spouse inherits (triggering the unlimited marital deduction) — then computes:

• Net estate: Assets minus liabilities
• Federal exemption remaining: How much of the exemption your estate uses
• Taxable estate: The amount above the exemption (taxed at 40%)
• State estate tax: If applicable, the state-level tax based on your state's exemption threshold

Gifting Strategy

The annual gift tax exclusion lets you give up to $20,000 per recipient per year (2026; indexed for inflation) without filing a gift tax return or using any of your lifetime exemption. For a married couple, that's $40,000 per recipient per year.

The tool shows:

• How much of your lifetime exemption gifting consumes: If you give above the annual exclusion, it reduces your lifetime exemption dollar-for-dollar
• Annual gifting capacity: How many years of $20K/person gifting it would take to move your estate below the exemption threshold
• Spousal impact: When the unlimited marital deduction applies, the surviving spouse's estate can use both exemptions — but only if proper planning is in place (portability election)

Real Numbers: A $5M Estate with a Spouse

• Total assets: $5,000,000
• Total liabilities: $500,000
• Net estate: $4,500,000
• Annual gifting: $40,000 (couple, to each of two adult children = $80,000/year)
• Spouse inherits: Yes

Under current rules (2026 exemption): At $15M per person, the $4.5M net estate is well below the threshold. Federal estate tax: $0.

But growth matters: at a 6% growth rate, a $4.5M estate doubles in roughly 12 years. For estates likely to approach the threshold over a decade or two, gifting early — before the estate grows into taxable territory — is where the leverage lives.

State-level exposure: If the couple lives in Massachusetts (exemption: $2M), the state estate tax on the $2.5M above the exemption would be approximately $200,000–$250,000.

Gifting impact: At $80,000/year in gifts, over 15 years the couple moves $1.2M out of the estate — potentially bringing the net estate below state exemption thresholds. The tool shows the trajectory.

For a Larger Estate

If the net estate were $23M (above the $15M exemption):

• Federal estate tax on the $8M above exemption at 40%: $3.2 million
• Annual gifting of $80,000/year would take roughly 100 years to move the full excess out — not practical
• The real strategies — irrevocable trusts, ILITs, GRATs — are beyond what the microtool models, but the tool signals when you need to talk to an estate planning attorney

Why Advisors Only Touch This for the Wealthy

Estate planning is complex, state-specific, and legally intensive. Most financial advisors don't discuss it unless you have $10M+ — and even then, they refer you to an attorney. The result: people with $2–7M estates in states with low exemptions get blindsided.

Alistair gives you the exposure number. If it's zero, great — you know. If it's significant, you know it's time to call an estate planning attorney.

That's what this microtool does. Know if you have an estate tax problem before it becomes your heirs' problem.