2027 Estate Tax Exemption: $15,480,000; Gift Exclusion $20,000

The federal estate and gift tax exemption entered a new era in 2026, and the search interest in “2027 estate and gift tax exemption” reflects planners trying to look one year ahead. The 2027 numbers are now official: the IRS released them on November 5, 2026, in Revenue Procedure 2026-35. This page keeps the projection we published beforehand, because the way it differed from the official figure is the most instructive part of the story: we anchored on the confirmed 2026 figure, explained the indexing method the statute requires, and projected a range.

The short answer. The 2027 basic exclusion amount is $15,480,000 per individual ($30,960,000 for a married couple using portability), and the annual gift exclusion is $20,000, both confirmed in Revenue Procedure 2026-35 (sections 3.44 and 3.46, news release IR-2026-133, November 5, 2026). For 2026, the basic exclusion amount is $15,000,000 per individual ($30,000,000 for a married couple), confirmed by the IRS and made permanent by the One Big Beautiful Bill Act (OBBBA). It is indexed for inflation starting in 2027. Before the release, our projection for the 2027 exemption was roughly $15.46–$15.49 million per person, with $15,490,000 as the central estimate. The official figure, $15,480,000, is inside that range and $10,000 below the central estimate; the section below explains why. The annual gift exclusion is $19,000 for 2026 and $20,000 for 2027, as projected, because the unrounded figure cleared the rounding threshold comfortably. See our IRS 2027 inflation adjustments tracker for the full set of indexed 2027 numbers and what the CPI has already decided.

What OBBBA actually changed

The context that matters is the sunset that did not happen. The 2017 Tax Cuts and Jobs Act roughly doubled the estate and gift exemption but with an expiration date: absent new legislation, the elevated amount was scheduled to lapse at the end of 2025 and fall back to its pre-2018 level adjusted for inflation — approximately $7 million per person — on January 1, 2026. For two years, estate-planning advice was dominated by “use it or lose it” urgency, pushing high-net-worth families to make large lifetime gifts before the window closed.

The One Big Beautiful Bill Act, signed into law on July 4, 2025, removed that cliff. It set the basic exclusion amount at $15,000,000 for 2026 and, crucially, did not attach a sunset — the exemption is now a permanent feature of the code, indexed for inflation, unless a future Congress changes it. The IRS subsequently confirmed the $15,000,000 figure for 2026 in its tax-year-2026 inflation-adjustment release, up from $13,990,000 for decedents dying in 2025.

The practical consequence is that the pre-2025 planning urgency is gone. Families that rushed large gifts to “lock in” the high exemption did nothing wrong, but families that waited did not lose the benefit. The exemption is no longer a disappearing resource; it is a stable, inflation-tracked baseline.

How the indexing works — and why we projected a range

The exemption is tied to inflation by statute. The basic exclusion amount under IRC §2010(c)(3) is adjusted each year using the chained Consumer Price Index (C-CPI-U), the same chained measure the §1(f)(3) inflation mechanism uses for the broader code. The estate exemption rounds to the nearest $10,000; the annual gift exclusion rounds down to the next lowest multiple of $1,000.

Because the adjustment depends on the C-CPI-U reading for a measurement period that ran through August 2026, the exact 2027 figure was bounded tightly before the IRS published it. Projecting from the $15,000,000 base using the statutory chained-CPI method and the full window of data now published puts the 2027 exemption in a $15.46 million to $15.49 million range per person, with $15,490,000 as the central estimate. That range had narrowed once the window closed, but it had not collapsed to a single number, because two separate sources of uncertainty remained open: whether the IRS’s calculation treats the missing October 2025 data point — never collected, because of the 2025 government shutdown, and never to be published — by averaging the eleven months that exist or by imputing it from the surrounding months; and whether the agency’s own 2025 base-year average ultimately lands at the originally reported 177.11 or the since-revised 177.206. Averaging the eleven real months against the 177.11 divisor gives $15,490,000; the same average against the revised 177.206 divisor gives $15,480,000; imputing October instead gives $15,470,000 or $15,460,000 depending on the same divisor choice. The IRS resolved both questions in Revenue Procedure 2026-35, section 3.44. It averaged the eleven published months and left the missing October 2025 index out, and for this amount, whose base year is 2025, it divided by the revised 2025 window average that the Bureau of Labor Statistics shows now, 177.206, rather than the 177.11 used last year. That is the case our projection placed at $15,480,000, the lower of the two eleven-month figures, so the official exemption is $15,480,000, not the $15,490,000 central estimate. The same revised divisor explains why other amounts with a 2025 base year came out as they did. For the full method and every other indexed 2027 figure it reproduces, see the IRS 2027 inflation adjustments tracker.

The annual gift exclusion — why 2027 rose to $20,000

The annual gift exclusion under IRC §2503(b) is the amount you can give any number of individuals each year without using any of your lifetime exemption or filing a gift-tax return. For 2026 it is $19,000 per recipient, unchanged from 2025. A married couple can combine their exclusions through gift-splitting to give $38,000 per recipient.

For 2027, the exclusion changed. The IRS confirmed $20,000 in Revenue Procedure 2026-35, section 3.46, the same figure we projected. The exclusion is built off a $10,000 base tied to 1997, indexed for inflation using the same chained-CPI method that drives the estate exemption, and rounded down to the nearest $1,000. Running that formula against the 1997 base index of 90.886 and the now-closed 2026-window C-CPI-U average of 182.8565 (September 2025 through August 2026, all eleven real months) gives 10,000 × (182.8565 / 90.886) = $20,119 unrounded, which rounds down to $20,000. That is a real step up, not a rounding coin-flip — it would have taken a fall of roughly 6% in the August C-CPI-U reading to pull the unrounded figure back under $20,000 and hold the exclusion at $19,000, and the actual reading landed nowhere near that.

The reason $19,000 held for two years running is worth explaining, because it looks like a pattern and is not. The unrounded 2026 figure came in at about $19,490 — short of the $20,000 the round-down rule needs before the exclusion can tick up to $20,000. That shortfall, not a lack of inflation, is why 2026 repeated 2025’s $19,000 exclusion. For 2027 the same arithmetic cleared that threshold with enough room, and $20,000 is the official figure.

What this means for planning

A permanent $15 million exemption changes the calculus for most households in one direction: the federal estate tax is now a concern for a smaller slice of families than the pre-2018 baseline would have made it. A married couple with full portability shields $30 million before any federal estate tax applies in 2026, and $30,960,000 in 2027.

Three durable takeaways follow. First, portability still requires a filing — the surviving spouse only inherits the deceased spouse’s unused exemption (the DSUE amount) if an estate tax return is filed to elect it, even when no tax is owed. Second, the annual exclusion is still the cleanest gifting tool, because $19,000 per recipient in 2026 (or $38,000 per couple), rising to $20,000 in 2027, moves wealth out of the estate every year without touching the lifetime exemption or triggering a return. Third, state estate and inheritance taxes are separate — several states impose their own estate tax at thresholds far below the federal $15 million, so the federal permanence does not eliminate state-level planning.

Estates and trusts also pay income tax on what they keep, and on a far steeper schedule: the 37 % rate starts at $16,500 for 2027 (trust and estate tax brackets 2027). For the income-tax side of a household’s picture, the same chained-CPI mechanism drives the annual bracket and deduction adjustments — see how adjusted gross income and modified AGI feed the thresholds that interact with these limits.

What to verify

• The official 2027 figures in Revenue Procedure 2026-35, section 3.44 (estate) and section 3.46 (gift), released November 5, 2026.
• Your state’s estate or inheritance tax, which can apply far below the federal threshold and is unaffected by OBBBA.
• Portability filing requirements with an estate attorney if a spouse has died — the DSUE election is easy to miss and cannot always be fixed later.
• The annual exclusion before large gifts, since the per-recipient figure is the line between a no-filing gift and one that uses lifetime exemption. It is also the ceiling in the Trump account safe harbor: see Trump account gifts and Form 709: the Rev. Proc. 2026-25 safe harbor.

The annual exclusion that sits underneath the lifetime exemption has its own page: it stepped up to $20,000 in 2027 after two years at $19,000 (gift tax annual exclusion 2027).

Sources

• 2026 figures, confirmed: IRS — Tax inflation adjustments for tax year 2026, including OBBBA amendments. Basic exclusion $15,000,000 (up from $13,990,000 in 2025); annual exclusion $19,000.
• OBBBA permanence (no sunset): One Big Beautiful Bill Act, signed July 4, 2025, amending IRC §2010(c)(3).
• Inflation-indexing method (chained CPI, rounding): IRC §1(f)(3) and §2010(c)(3); annual exclusion under IRC §2503(b).
• 2027 figures, official: Rev. Proc. 2026-35, §§ 3.44 and 3.46 and IRS news release IR-2026-133, November 5, 2026. The ranges described above were our pre-release estimates, based on the $15M base and chained-CPI data.