By Ben Martinek, CFP®, EA, CSLP®, RICP
President Trump’s comprehensive tax proposal referred to as the “One Big Beautiful Bill” has passed in the House and is now on its way to the Senate for further review. Spanning more than 1,100 pages, the bill aims to build upon the 2017 Tax Cuts and Jobs Act (TCJA) by extending key provisions, introducing new tax benefits for families and workers, and encouraging domestic economic growth. With an estimated cost of $4.1 trillion over the next decade, the legislation also contains several measures that could significantly influence estate planning and the transfer of wealth across generations.
Permanent Extension of Individual Tax Cuts
One of the core goals of the bill is to make the TCJA’s individual tax changes permanent. These include maintaining lower marginal tax rates, keeping the enhanced standard deduction ($32,000 for joint filers under the new bill), and continuing the repeal of personal exemptions. One of the thorniest issues is the state and local tax (SALT) deduction provision. It appears this figure should be a $40,000 cap up to $500,000 of AGI.
These provisions, while designed for income tax relief, indirectly impact estate planning by increasing after-tax cash flow and reducing the need for income-shifting strategies in the short term. The marriage penalty continues to be mitigated for most brackets, which is relevant for married couples structuring trusts or gifting strategies.
Increased Gift and Estate Tax Exemptions
Significantly, the proposal would make the higher estate and gift tax exemption amounts permanent, rather than allowing them to sunset in 2026. Under current law, the lifetime exemption is $13.61 million per person ($27.22 million per couple), but it’s scheduled to drop by about half when the TCJA provisions expire. Trump’s new bill would maintain the higher thresholds indefinitely, providing high-net-worth individuals with an extended window to transfer wealth without triggering federal estate or gift tax. For families with complex estate plans or large privately held assets (e.g., real estate, closely held businesses), this creates a valuable opportunity to revisit the benefits of trusts, such as Grantor Retained Annuity Trusts (GRATs), SLATs (see below), Irrevocable Life Insurance Trusts (ILITs), and other gifting vehicles.
Step-Up in Cost Basis and Capital Gains Treatment
Importantly, the bill retains the step-up in basis at death, meaning heirs would still inherit appreciated assets at their fair market value, eliminating built-in capital gains for income tax purposes. While there had been previous discussions about eliminating the step-up or taxing unrealized gains at death, this proposal takes no such step. This reinforces the value of holding appreciating assets through life and passing them on through the estate, especially for families with concentrated positions in real estate or closely held stock.
Implications for Trust Structures and Generational Planning
For those using irrevocable trusts to shield assets from estate taxes or control distributions over time, the permanence of the current exemption levels provides clarity and flexibility. It may also reduce the urgency of more aggressive estate freeze strategies, but it’s important not to become complacent; future political changes could reverse course.
Additionally, if you’ve been considering the use of dynasty trusts or spousal lifetime access trusts (SLATs), this bill may extend the planning horizon, offering more time to fully fund these vehicles.
Tax Incentives for Multigenerational Goals
Some of the new provisions in the bill may be minor on their own but carry long-term planning implications. For example, the proposed “MAGA Savings Accounts” would allow tax-free savings of up to $1,000 annually per child born during Trump’s second term. While largely symbolic, these accounts could be leveraged as part of a broader multigenerational wealth strategy, especially if combined with 529 plans, Roth IRAs for teens, or custodial accounts for early investing.
Action Steps to Consider
Review gifting plans: Consider making additional lifetime gifts to family members or irrevocable trusts while the exemption is high.
Revisit trust strategies: With higher exemptions potentially locked in, now is the time to fine-tune SLATs, GRATs, and other irrevocable structures.
Reassess asset titling: Ensure taxable and non-taxable assets are titled optimally to take full advantage of step-up in basis rules.
Coordinate with legal counsel: Estate planning documents such as wills, trusts, and powers of attorney should be updated regularly to reflect current law and family dynamics.
Will the Big Beautiful Tax Act Impact Your Estate Plan? Let’s Talk.
At Bona Fide Finance, we’re actively tracking the progress of this legislation as it moves through Congress. Even if the bill doesn’t pass in its entirety, the proposed changes offer valuable insight that can inform your estate planning and legacy goals.
If you’re wondering how your estate or wealth transfer plan may need to adapt, we’re here to help. If you’d like to see if we would be a good collaborative fit together, schedule an introductory meeting by calling (701) 203-3219 or emailing hello@bonafidefinance.com.
About Ben
Ben Martinek, CFP®, EA, CSLP®, RICP®, is the founder and lead advisor at Bona Fide Finance, an independent, fee-only firm dedicated to helping doctors, young professionals, and growing families take control of their financial future. With a deep understanding of student loan debt—having tackled his own—Ben specializes in guiding clients through debt repayment strategies, smart investing, and comprehensive financial planning so they can build wealth with confidence. Ben’s passion for financial planning comes from his desire to provide honest, objective advice tailored to each client’s unique situation. He loves seeing the impact of his work, whether it’s helping a family pay off student loans years ahead of schedule, setting up an early retiree for financial freedom, or giving clients the peace that comes from knowing their finances are in order. His clients appreciate his thoughtful, high-touch approach, often saying that working with him has changed their lives.
Before launching Bona Fide Finance in 2015, Ben’s career path was anything but conventional. The fourth of nine children, he grew up in rural Indiana and initially pursued a path in academia, earning a B.A. in philosophy and classical languages, followed by a master’s degree in philosophy. Along the way, he explored careers in construction and truck driving—logging over 600,000 miles across the U.S. with his wife, Deb—before finding his true calling in financial planning.
Now based in Mandan, North Dakota, Ben and Deb stay busy raising their two daughters, Edith and Virginia. Since their truck-driving days, Ben is happiest on a long road trip—preferably behind the wheel of his TDI Volkswagen Jetta. He enjoys sailing on Lake Sakakawea, camping in their vintage ’90s pop-up camper, and smoking a pipe by the grill. A lover of strategy board games, he favors Clans of Caledonia (mostly because Deb refuses to play Risk with him). When he’s not working with clients, he can be found smoking meat, gardening, hiking, or diving into The Lord of the Rings or Dune. Ben also serves on the school board for his daughters’ Montessori school and is actively involved in pre-marriage ministry in the Bismarck Diocese. To learn more about Ben, connect with him on LinkedIn.