New changes in federal gift and GST tax exemptions provide a unique opportunity for proactive estate planning, especially for The Walt Disney Company employees who want to transfer wealth without incurring significant taxes,' says Kevin Landis, a representative of The Retirement Group, an affiliate of The Retirement Group.

Brent Wolf from The Retirement Group, a division of The Retirement Group, encourages The Walt Disney Company employees to take advantage of the permanent gift and GST tax exemption increases under OBBBA as a means of effective estate planning.

In this article, we will discuss:

1. The role of Inflation Adjustments: How the annual inflation adjustments to federal gift and GST tax exemptions create opportunities for tax efficient wealth transfer.

2. Strategies for Estate Planning: An overview of various estate planning strategies including SLATs, GRATs, and Dynasty Trusts that can be useful for The Walt Disney Company employees.

3. State Tax Consequences: How state taxes affect estate planning and what this means for residents of New York, New Jersey, and Connecticut.

The federal gift and generation-skipping transfer (GST) tax exemption amounts have been permanently established under the One Big Beautiful Bill Act (OBBBA, signed July 2025). This adjustment presents new possibilities for sophisticated estate planning especially for the benefit of The Walt Disney Company employees. It is now possible to exclude $15,000,000 for an individual and $30,000,000 for a married couple from federal gift and GST taxes. In the present economic environment of low asset values these changes present a good opportunity to move wealth across the generations.

The federal estate and gift tax exclusion, as well as the GST tax exemption, were significantly raised under recent tax legislation and permanently extended by the One Big Beautiful Bill Act (OBBBA, signed July 4, 2025) to $15 million per person. This enables many assets to be transferred without tax consequences during the owner’s lifetime or at their death. However, these higher exemption levels have been permanently extended under the One Big Beautiful Budget Act (OBBBA, signed 2025), locking in the elevated gift and estate tax limits indefinitely.

The 2018 regulations significantly increased the amount that can be gifted, and with OBBBA making these rules permanent, families can now plan long-term gift strategies without concern about a reversion to lower limits. This update is important as it provides opportunities for taking full advantage of tax-deferred wealth transfers while the tax laws permit it. The American Taxpayer Relief Act of 2012 also allowed the surviving spouse to use the deceased spouse’s unused federal estate tax exclusion in paying for the deceased’s lifetime gifts or estate planning.

The annual federal gift tax exemption has also been increased to $19,000 per recipient, or $36,000 for married couples who choose to gift together. This increase expands the opportunities for tax planning to gift and still leave some exemption available to pay for tuition or medical expenses — important for The Walt Disney Company employees who are helping to pay for their families’ education or health care. It also helps with the possibility of gradual giving.

State Specific Factors to Consider:

This is especially important for residents of New York, New Jersey, and Connecticut because of state tax consequences. For instance, New York does not have a gift tax but has many opportunities to take advantage of large federal exemptions in order to avoid state estate taxes, especially in light of recent market conditions. New Jersey has no gift or estate taxes, but does have an inheritance tax on transfers to non-lineal descendants at rates up to 16%. Connecticut is the only state with a gift tax, but because of the synchronization of federal and state exemptions, the burden is reduced.

Estate Planning Techniques:

In the present tax regime, the following strategies should be considered for The Walt Disney Company employees:

1. Spousal Lifetime Access Trusts (SLATs): These enable the client to invest and grow assets outside the taxable estate while ensuring that the spouse is well provided for through the use of exemption amounts.

2. Grantor Retained Annuity Trusts (GRATs): These provide for the transfer of any appreciation in the assets to beneficiaries without incurring tax on the amount retained in the annuity, which is particularly advantageous in a volatile market.

3. Dynasty Trusts: These trust arrangements are created to take full advantage of the GST tax exemptions and hold assets beyond estate, gift, and GST taxes for multiple generations, providing a long-standing protection against creditors’ claims.

4. Intrafamily Loans and Sales to Grantor Trusts: These methods use valuation approaches and low-interest rates to move the wealth and at the same time reduce the value of the estate that will be taxed, while the assets grow.

Income Tax Considerations:

Grantor trusts are quite efficient from the perspective of income taxes as the trust’s income is reported on the grantor’s return, allowing the assets to grow without being taxed. This structure can be very useful for asset swaps that may reset the basis for capital gains after the grantor has died. In conclusion, the temporary increase in federal tax exemptions presents an important opportunity for The Walt Disney Company employees to plan their estates. Using these exemptions together with sophisticated gifting and trust arrangements can lead to substantial tax savings and wealth protection.

It is, therefore, important to have a clear understanding of both state and federal tax laws and to have an appropriately tailored estate plan to meet personal and family objectives. The state estate taxes can significantly influence estate planning and therefore cannot be ignored, particularly for people nearing retirement or who are already retired. This is especially important in states such as Massachusetts and Oregon where the estate tax starts at $1 million in value and it is imperative to use federal exclusions to avoid state tax consequences while maximizing on federal tax benefits.

These adjustments to the GST and federal gift tax exemptions are like steering a ship through a rapidly changing sea. Like a good captain, The Walt Disney Company employees can take advantage of these temporarily higher exemptions, now at their highest ever, to steer their retirement.

Disclosure: Not tax advice. Please consult with a qualified tax professional regarding your unique situation.

That protection goal extends directly into how you structure the survivor and dependent options within The Walt Disney Company's benefits. The Walt Disney Company maintains an active defined benefit pension plan, meaning eligible employees continue to accrue benefits based on years of service and compensation. If you are eligible for a lump sum payout, IRS Section 417(e) segment rates determine how the future annuity stream converts to a present-value payment - rising rates compress the lump sum, so monitoring the plan's stability period and lookback month is critical before you lock in your election date. The choice between a single-life annuity, a joint-and-survivor option, or a lump sum (where available) is generally irrevocable once made, and timing that decision relative to interest rate conditions can meaningfully affect your retirement income picture.

On the healthcare side, The Walt Disney Company provides continued medical coverage to eligible retirees, which can bridge the gap between retirement and Medicare eligibility at age 65 or serve as a supplement to Medicare thereafter. Confirming the service and age requirements for retiree coverage, and understanding your premium contribution, is an important step in building an accurate healthcare cost projection. Coordinating The Walt Disney Company's retiree coverage with Medicare Part B and Part D enrollment timing can also reduce duplication and avoid late-enrollment penalties. Connecting your specific The Walt Disney Company benefits situation to a comprehensive retirement income plan - and understanding how each component interacts - gives you the most complete picture of what retirement will look like.

Sources:

1. 'IRS Provides Tax Inflation Adjustments for Tax Year 2024.' Internal Revenue Service, 9 Nov. 2023,  www.irs.gov/newsroom/irs-provides-tax-inflation-adjustments-for-tax-year-2024 .

2. 'How Do the Estate, Gift, and Generation-Skipping Transfer Taxes Work?' Tax Policy Center, Jan. 2024,  www.taxpolicycenter.org/briefing-book/how-do-estate-gift-and-generation-skipping-transfer-taxes-work .

3. 'Estate, Gift, and GST Taxes.' American Bar Association ,  www.americanbar.org/groups/real_property_trust_estate/resources/estate_gift_and_gst_taxes .

4. Driessen, Grant A. and Jane G. Gravelle. 'Overview of the Federal Tax System as in Effect for 2024.' Congressional Research Service , crsreports.congress.gov/product/pdf/R/R45145.

5. 'What's New — Estate and Gift Tax.' Internal Revenue Service ,  www.irs.gov/businesses/small-businesses-self-employed/whats-new-estate-and-gift-tax .