Navigating the One Big Beautiful Bill Act with Confidence

The One Big Beautiful Bill Act: What California Families Should Know

Major legislative changes can leave many families feeling uncertain—especially when they affect something as personal and long-term as your estate plan. The One Big Beautiful Bill Act (OBBBA), signed into law in July, brings several important updates that may impact wills, trusts, tax planning, and long-term care strategies.

As a California estate planning attorney serving Alpine, Alameda, Contra Costa, and El Dorado counties, I help families understand how new laws affect their plans. With the right guidance and a proactive review of your documents, the OBBBA can present meaningful opportunities rather than obstacles.

Higher Federal Estate & Gift Tax Exemptions

Beginning January 1, 2026, individuals will be able to pass on up to $15 million—and couples up to $30 million—free of federal estate tax, with future adjustments for inflation. This increase replaces years of uncertainty and gives families a strong reason to review their living trusts, wills, and overall estate plans.

If you’re wondering whether your current documents still meet your goals, a simple review with a wills and trusts attorney in California can help ensure everything stays aligned.

Temporary Social Security Tax Relief

The OBBBA provides temporary relief for seniors over age 65 who meet certain income thresholds, allowing a deduction of up to $6,000 (or $12,000 for couples). This may reduce federal taxes on Social Security benefits—at least until the provision expires in 2028. It’s a good time to revisit income planning with your financial and legal advisors.

Long-Term Care Planning Matters More Than Ever

With $1 trillion in federal Medicaid cuts, stricter eligibility rules, and new work or volunteer requirements, qualifying for long-term care benefits may become more challenging. For Californians, especially those caring for aging parents, this makes advance healthcare directives, powers of attorney, and thoughtful end-of-life planning even more essential.

Families may want to explore private long-term care insurance or asset protection strategies as part of a well-rounded plan.

Minimal Federal Estate Tax Exposure—but Don’t Forget State Rules

Only about 0.25% of estates are expected to owe federal estate tax under the updated exemptions. California does not impose its own estate or inheritance tax, but if you own property or have heirs in another state, those rules could still come into play. Reviewing your documents regularly ensures you stay ahead of multi-state issues.

Estate Tax Structure Remains Largely Unchanged

Aside from increased exemptions, the overall structure of estate, gift, and generation-skipping transfer (GST) taxes remains the same. Many provisions introduced under the 2017 Tax Cuts and Jobs Act are still intact, which helps preserve predictability in long-term planning.

Potential Future Medicare Cost Increases

Because key Medicare cost-sharing assistance rules are now delayed until 2034—and with potential cuts of up to $490 billion—beneficiaries may see higher out-of-pocket costs in future years. If PAYGO rules trigger additional reductions, coverage choice could narrow for many seniors.

Now Is a Smart Time to Revisit Your Estate Plan

The OBBBA may introduce complexity, but it also offers a valuable opportunity to update and strengthen your plan. Reviewing your revocable living trust, pour-over will, long-term care strategies, and tax planning ensures your wishes are protected and your loved ones are supported—no matter how laws evolve.

If you’d like help reviewing your documents or planning next steps, I’m here to make the process clear, simple, and human. As a Markleeville estate planning attorney serving clients statewide, I offer practical guidance, plain‑English explanations, and direct access when you need answers.

Ready to update your plan? Contact Elizabeth Sears Law to schedule a consultation and make sure your estate plan continues to protect what matters most.