Is Your Estate Plan Ready for 2026? Navigating Idaho Law and the OBBB Increase
If you call the Gem State home, you’re already ahead of the curve when it comes to "death taxes." But as we move through 2026, the landscape of wealth transfer has shifted significantly. Thanks to the federal One Big Beautiful Bill (OBBB), the rules for high-net-worth families have changed, offering a historic opportunity to protect your legacy.
In this guide, we’ll break down what Idaho residents need to know about state-level taxes and how the new federal $15 million exemption impacts your estate planning strategy.
Does Idaho Have an Estate Tax?
The short answer is no. Idaho is one of the 38 states that does not levy a state-level estate tax.
Unlike neighbors like Oregon or Washington, where estates can be taxed at the state level starting at much lower thresholds, Idaho residents do not have to worry about a "death tax" from the Idaho State Tax Commission. Additionally:
No Inheritance Tax: Heirs in Idaho do not pay tax on the assets they receive.
No Gift Tax: There is no Idaho state tax on gifts made during your lifetime.
However, just because the state isn’t taking a cut doesn't mean you're in the clear. The federal government still looms large, and that is where the OBBB Act comes into play.
The OBBB Revolution: A $15 Million Federal Exemption
For years, estate planners were bracing for the "sunset" of the 2017 tax cuts, which would have slashed the federal estate tax exemption in half by 2026. However, the passage of the One Big Beautiful Bill (OBBB) in July 2025 changed everything.
As of January 1, 2026, the federal estate and gift tax exemption has been officially raised and "made permanent" (barring future legislation).
Key 2026 Federal Tax Figures:
Provision 2026 Limit
Individual Exemption $15,000,000
Married Couple Exemption $30,000,000
Annual Gift Exclusion $19,000 (per recipient)
Top Tax Rate 40%
What this means for you: If your total estate (including property, investments, and business interests) is valued under $15 million, you will likely owe zero federal estate tax.
Why the OBBB Matters for Idahoans
While the $15 million threshold sounds high, Idaho’s booming real estate market and the growth of family-owned businesses mean more residents are hitting these numbers than ever before.
1. The End of the "Use It or Lose It" Panic
Before the OBBB, many wealthy Idahoans were rushing to gift assets before 2026 to avoid the expected exemption drop. Now that the $15 million baseline is secure and indexed for inflation (starting in 2027), you can take a more measured, strategic approach to your planning.
2. Portability Still Applies
For married couples in Idaho, "portability" remains a powerful tool. If one spouse passes away without using their full $15 million exemption, the surviving spouse can "add" the unused portion to their own. This effectively allows an Idaho couple to pass down $30 million tax-free.
3. Permanent Certainty
The OBBB removed the "sunset" provision that haunted the previous tax code. This provides a stable foundation for long-term trusts, such as Irrevocable Life Insurance Trusts (ILITs) or Family Limited Partnerships, which are common among Idaho’s agricultural and business leaders.
Strategic Steps for 2026 and Beyond
Even with a high exemption, proactive planning is essential to protect your assets from the 40% federal marginal rate.
Review Your Trust: Ensure your current documents account for the higher $15M/$30M limits.
Leverage Annual Gifts: You can still give away $19,000 per person, per year, without touching your $15 million lifetime exemption.
Watch Out-of-State Property: If you own a second home in a state like Washington or New York, you may still owe state estate taxes there, even as an Idaho resident.
Conclusion
Idaho remains one of the most tax-friendly states for retirees and high-net-worth individuals. With no state estate tax and a newly bolstered federal exemption of $15 million, 2026 is an ideal year to solidify your legacy.
Is your estate plan ready for the OBBB era?
The laws may be more favorable, but they are also more complex. Contact an attorney with Atkins Law Offices to ensure your assets are protected under the new federal guidelines.