Estate tax planning is the process of arranging how your assets transfer at death so your heirs keep as much as the law allows and the transfer happens the way you intend. For business owners it is not a retirement-age concern, because your business is usually one of the largest assets in your estate, and its value tends to grow fastest when you are not watching it.
The headline number changed for 2026. The federal estate and gift tax exemption is now $15 million per individual, or $30 million for a married couple using portability, up from $13.99 million in 2025 (IRS, Revenue Procedure 2025-32). Under the 2025 tax law signed July 4, that higher exemption is permanent, which ended years of owners scrambling to plan around a scheduled expiration. The annual gift exclusion holds at $19,000 per recipient for 2026.
For most owners reading this, $15 million sounds like it takes estate tax off the table. Often it does. But three things keep this worth a real conversation rather than an assumption.
Your business value moves. A company worth $2 million today that grows even modestly for a decade is a very different estate conversation in ten years. Planning early lets you move future appreciation out of your taxable estate while the value is still small.
State-level estate taxes do not follow the federal number. Roughly a dozen states and D.C. impose their own estate or inheritance tax, several with exemptions far below $15 million. A business owner who is federally exempt can still owe real money at the state level depending on where they live.
"No federal tax owed" and "no planning needed" are separate statements. Buy-sell agreements, how ownership passes to a spouse or partners, and business succession all matter regardless of the tax bill, and every one of them gets harder to handle well once you are planning around a health event instead of a strategy.
The gift exclusion is a quiet tool here. At $19,000 per recipient per year, with no cap on the number of recipients, an owner can move meaningful value out of an estate annually without touching the lifetime exemption at all.
Common questions
What is the 2026 federal estate tax exemption? $15 million per person, $30 million per married couple, per IRS Revenue Procedure 2025-32.
Is the higher exemption permanent? Yes. The 2025 law removed the scheduled sunset. It is indexed for inflation going forward.
Does my business count toward my estate? Yes. Business interests are included at fair market value, which is why owners often have larger taxable estates than they expect.
HYON Q builds estate and succession planning into a broader tax strategy from offices in Chicago, Miami, and Houston. Start with a free 30-minute call: https://www.hyonq.com/book-consultation