IRS Raises 2027 Estate Tax Exemption to $15.48 Million per Person

The Internal Revenue Service (IRS) has set the ceiling on assets that can be transferred free of estate and gift tax for tax year 2027 at $15.48 million per person, up from $15 million in 2026. The figure, known as the basic exclusion amount, applies to asset transfers made during life and after death, and serves as a reference point for wealth planning among affluent American families.

The decision was announced on Thursday (5/11/2026) local time, alongside inflation adjustments to dozens of other fiscal provisions. Besides the estate threshold, the IRS also raised federal income tax brackets, the capital gains tax limit, and the eligibility threshold for the earned income tax credit. The adjustment is a routine procedure, but this year's momentum feels different because it comes amid cost-of-living pressures that continue to weigh on American households.

The increase in the estate tax exemption is tied to a major tax law change signed by President Donald Trump. The policy package dubbed the "big beautiful bill" raised the exclusion limit to $15 million per person. Without congressional intervention, the threshold was supposed to revert to its 2017 level—$5 million plus inflation adjustment—after 2025. That threat triggered a wave of early estate planning among ultra-wealthy families, who raced to lock in asset structures before the old rules returned.

Although the figure looks large, the reach of the federal estate tax is actually very narrow. According to estimates by the Tax Policy Center, an independent research group, of the roughly 6,890 estate tax returns expected in 2026, only about 3,900 result in a tax liability. In other words, for most American families, this rule barely touches daily life. But for a handful of households with net worth above tens of millions of dollars, every increase in the threshold means significant tax savings and more room to design intergenerational asset transitions.

It is worth noting that the federal threshold is not the only determinant. A number of states impose estate or inheritance taxes with much lower limits. In some jurisdictions, assets worth just a few million dollars can already trigger a local tax liability. As a result, wealthy families with assets across state or national borders must recalculate their strategies, including the use of trusts, staged gifts, and life insurance as tax-mitigation instruments.

"This increase provides short-term certainty, but it does not eliminate political uncertainty. Tax law can change again, and good estate planning must assume that change," said a certified financial planner who handles high-net-worth clients, as quoted in a CNBC report.

For Indonesia, this development is worth watching even though its tax regime differs. Indonesia does not apply a specific estate tax, but it has income tax on gains from property transfers and a land and building tax. Issues of wealth inequality and intergenerational asset transparency are increasingly appearing in domestic policy discussions. If the global trend moves toward tightening estate tax loopholes—as pushed by several European countries—pressure to review similar fiscal instruments at home could grow. Conversely, the US decision to raise the threshold shows the opposite direction: competition to attract capital and wealthy families still benefits countries with looser rules.

Going forward, the question is not just how large next year's exemption will be, but how long this policy will last. US political cycles and the need for state revenue could once again reshape the estate tax landscape. High-net-worth families will likely keep watching developments in Congress, while the middle class—the focus of cost-of-living rhetoric—might ask: how fair is a system that exempts billions of dollars in wealth from tax while their daily bills keep rising?