Wealthy families regret rushing to give gifts after tax law changed - USA Today

Giving is expected during the great wealth transfer, but some families are discovering after they rushed to give away their assets to save on taxes that they may have gotten the timing wrong, some financial analysts said.

Many families in 2024 and 2025 rushed to their accountants, advisers and attorneys to set up estate plans to lock in the benefits of the soon-to-be expiring Tax Cuts and Jobs Act of 2017. The TCJA lowered tax rates, doubled the standard deduction and doubled the lifetime gift exemption but was scheduled to sunset at the end of 2025. All that changed when President Donald Trump signed into law on July 4, 2025, his signature tax and spending package that made permanent all those provisions.

People could slow down and take time to hash out a plan to give their assets away, well, except for those who already accelerated their gift-giving.

“Are people having buyer’s remorse? Yes, maybe some of them,” said Dina Friedman, private wealth strategies adviser at Merrill.

With more than 11,000 baby boomers now turning 65 years old every day, approximately $124 trillion is expected to shift to younger generations and charities through 2048, according to Cerulli and Associates.

With so much at stake, wealthy families cheered the TCJA, which doubled the tax-free lifetime gift exemption to $11.18 million per person ($22.36 million for married couples) in 2018 from $5.49 million in 2017. By 2025, the inflation-adjusted exemptions had reached $13.99 million per person, or $27.98 million per couple. Those amounts, in addition to annual $19,000 gifts to as many people as you wanted, could be given tax free.

But TCJA was set to expire at the end of 2025, and lifetime exemptions would revert to lower levels. The exemption was set to drop in half to about $7 million for an individual and $14 million per couple on Jan. 1, 2026. Rich families, not wanting to pay estate taxes on millions more dollars, rushed to give away as much as they could to take advantage of the limited-time higher gift exemptions.

Then, Congress passed the tax provisions of Trump's signature legislation, popularly known as the One Big Beautiful Bill, last July, before the TCJA sunset. It made the huge inflation-adjusted exemptions permanent. Most wealthy Americans breathed a sigh of relief, but some regretted accelerating their giving when they could have held onto and enjoyed their riches a little longer, some advisers said.

What can people with regrets do?

Clawing back some of the assets you’ve given away can be tricky, but most of the time, there are a few options, advisers said.

Irrevocable trusts, long-known to be unchangeable and irreversible, have evolved over the years to be more flexible, Friedman said. “Decanting” is a legal process that allows trustees to “pour” assets from an old trust into a new one with more favorable terms such as giving trustees authority to distribute principal.

“A lot depends on state law, but you can also move to a better [more favorable] state,” she said. “The trustee has the power to move a trust to another jurisdiction.”

Many irrevocable trusts nowadays also have independent third-party trust protectors who can modify trust terms, such as altering administrative provisions, removing or replacing trustees, changing governing law, or modifying beneficiary interests, Friedman said.

In an irrevocable children’s trust, the grantor, or the original donor, can take a loan from the trust without tax consequences as long as it’s paid back with interest, she said. Otherwise, the IRS could say the parents are the true beneficiaries of the trust and count its assets toward their taxable estate.

Is it worth it to try to unwind gifts?

Although good tax attorneys, accountants and financial advisers can probably find a way to make changes, people must remember “there is a trade off,” said Shannon Stevens, managing director and head office at Hightower Signature Wealth.