Estate Tax Certainty for 2026: What a $15M Exemption Really Changes (and Doesn’t) for Bay Area Families

The federal estate, gift, and GST (generation-skipping transfer) tax landscape finally has some predictability. Beginning January 1, 2026, the unified federal exemption is $15 million per person (indexed for inflation thereafter). For most upper–middle class Bay Area families, this means fewer worries about federal estate tax—but it does not make thoughtful planning optional.

What actually changes

·      Higher baseline, no near-term “sunset.” Households under roughly $15M (single) / $30M (married) won’t face federal estate tax under current law.

·      Portability still matters. A surviving spouse can generally claim any unused exemption (known as “DSUE”), but only if a timely estate tax return is filed—even when no tax is due.

·      Charitable planning becomes elective, not defensive. You can focus on impact (DAFs, foundations, direct gifts) instead of using charity only to shrink a taxable estate.

What doesn’t change

·      Probate is still slow and public. In California, a properly funded revocable living trust remains the #1 way to keep your family out of court.

·      Property taxes are local. California’s Prop 19 rules can still trigger reassessment on intra-family transfers, especially with vacation homes and rentals. Federal estate tax relief does not stop county assessors.

·      Title and beneficiary mistakes still derail plans. The biggest failure we see is the “empty trust”—great documents with assets still titled in individual names.

Practical Bay Area playbook

1.        Trust funding checkup. Retitle your home(s), brokerage accounts, and closely held business interests to your trust; update beneficiary designations for retirement and life insurance.

2.        Equity compensation lens. RSUs/ISOs/NSOs create concentrated risk. Consider gifting strategies, DAF funding, or a concentrated-position plan.

3.        Vacation home plan. Tahoe/Napa properties benefit from clear co-ownership rules, expense sharing, and buyout options—often via an LLC owned by your trust.

4.        Guardians and incapacity docs. Advance Health Care Directive and Durable Power of Attorney are non-negotiable; update guardians for minor kids.

5.        Tax-aware giving. Use appreciated stock for gifts or charity; consider a donor-advised fund for bunching.

When to talk with counsel

·      Household net worth approaching or exceeding $15M/$30M

·      Complex family (blended, special needs, estranged heirs)

·      Equity-heavy wealth or multiple properties

Schedule a year-end Trust Funding & Title Review with Shafae Law to confirm your plan works as intended. Contact us by clicking here or by calling 650-389-9797.