How do I pay less taxes when I die?

I’m confident that for most people, the fear of the "Death Tax" is less of a mathematical reality and more of a constant cultural ghost.

But for those who have spent a lifetime compounding their wealth into something substantial, the question of how to pay less to the government when you die is both legitimate and pressing. As of 2026, we find ourselves in an interesting spot: the federal estate tax exemption has just increased to $15 million per individual (and a staggering $30 million for married couples).

In other words, unless you’ve been exceptionally successful at building your balance sheet, you likely don’t have a federal estate tax problem. However, there’s an important difference between assuming you’re safe and actually ensuring your legacy isn’t eroded by inefficiency. Another important note is that this staggering exemption has not always been this high. Who knows what happens next?

If you want to keep more of your hard-earned assets within your family circle, there are really only three levers you can pull.

1. The Strategy of "Giving While Warm"

The most effective way to reduce the size of your taxable estate is, quite simply, to not own the assets when you die. This sounds like an oversimplification, but it’s invariably true.

You can currently gift up to $19,000 per person, per year without even having to tell the IRS about it. If you and your spouse have three children and six grandchildren, you could effectively move $342,000 out of your estate every single year, tax-free. Over a decade, that’s millions of dollars in principal—plus all the future growth on those assets—that the tax man can never touch.

It’s an unfortunate reality that many people wait until they are gone to pass on their wealth, missing the chance to watch that capital work for the people they love while they are still here to see it.

2. The Direct Payment Loophole

There is a specific corner of the tax code that remains remarkably generous: direct payments for tuition and medical expenses.

If you write a check directly to a university for a grandchild’s tuition, or directly to a hospital for a loved one’s surgery, the IRS doesn't count it as a gift. There is no limit. You could spend $100,000 on a single year of private medical school and it wouldn’t touch your lifetime exemption. It’s a rare example of the government allowing you to be as generous as you want, provided you follow the "pay the institution, not the person" rule.

3. The Power of Irrevocability

For those whose wealth exceeds even the new $15 million threshold, "simple" gifting isn't enough. You have to look at structures like Irrevocable Trusts.

By moving assets into a trust—such as a Spousal Lifetime Access Trust (SLAT) or a Grantor Retained Annuity Trust (GRAT)—you are essentially freezing the value of those assets for tax purposes. You might give up some degree of control, but you gain a shield. The assets (and their future appreciation) are no longer "yours" in the eyes of the law, which means they aren't there to be taxed when you pass away.

None of this is to suggest that everyone needs a complex web of legal entities. For most of us, the focus should remain on the basics: designating beneficiaries and ensuring our Wills are current.

But if you are among those who have seen the benefits of a long-term bull market and disciplined saving, I think we’d be wise to pause and consider the incentives of a system that defaults to taking a cut. The world is getting richer, and your estate is likely no exception. Taking these steps isn't about being "anti-tax"; it’s about being pro-legacy.

If this raises questions about where your own estate stands relative to these new 2026 limits, please reach out.