The Death Tax Repeal Act of 2025: What It Could Mean for Ohioans

If you've worked hard your entire life to build something you love, the last thing you want to worry about is it being taken away by the government. But that's the reality many American's face when thinking about estate tax (sometimes called "death tax").

There's a legislative proposal gaining momentum that could change everything about how wealth transfers between generations. But what would these changes really mean for you and your loved ones?

Let’s explore the potential impact on you and your family below.

Possible Elimination of the Century-Old Estate Tax

Estate taxes have existed in America for over a century, yet they remain one of the most contentious elements of our tax system. The current estate tax applies to estates valued above a certain threshold. So, when someone passes away, the government may take a percentage of their assets before they reach the next generation.

Think of it this way: imagine spending decades cultivating a beautiful garden, only to have someone come in at the end and claim rights to some of your most prized plants before your children can enjoy them. That's how many families perceive the estate tax – as an extra burden during an already difficult time.

The Death Tax Repeal Act of 2025 (“DTRA”) aims to eliminate this tax entirely. Supporters argue it would remove what they see as unfair double taxation. After all, these assets were typically built with income that was already taxed once during the owner's lifetime. Why, they ask, should it be taxed again after death?

The potential repeal brings both opportunities and challenges that deserve careful consideration. Let's explore what this could mean from different perspectives.

Benefits and Drawbacks of the Death Tax Repeal Act for Ohioans

Other than one year in 2010 when the estate tax rate was zero, the federal estate tax has been as low as 10% in the first year it was introduced (1916) and as high as 77% (1941-1976). The current federal estate tax rate is 40% on assets over $13.61 million. In 2026, the exemption will drop back to around $6–7 million per person, unless Congress acts. The estate tax rate on assets passed on at death above that amount will be 40%.

For people with highly appreciated or hard-to-liquidate assets (such as business owners), the repeal could represent breathing room. The current estate tax can create an impossible situation: either sell portions of the business to pay the tax or take on massive debt to the IRS. Either way, the family legacy suffers.

Critics of the repeal point to important considerations on the other side. The estate tax generates revenue that helps fund essential government services like education, infrastructure, and social programs that benefit all Americans. If this revenue stream disappears, that funding will need to come from somewhere else. This could mean increases in taxes on retirement accounts, and other taxes that could affect middle and working-class families.

Additionally, some economists worry about the long-term effects on wealth concentration. Without an estate tax, extremely wealthy families could accumulate and transfer wealth across generations with fewer limitations, widening existing economic divides.

Either way, Ohioans do not have to worry about a state estate tax on top of the federal one. Ohio repealed its estate tax effective January 1, 2013.  As a result, there is no estate tax on estates of individuals with a date of death on or after January 1, 2013. 

How the Estate Tax Repeal Could Change Your Estate Planning Strategy

If the DTRA passes, it would dramatically change how many Americans approach their estate planning. Let's explore what this might mean for your personal strategy:

Simplified Planning for Larger Estates: For those with estates valued above the current exemption threshold, planning could become significantly simpler. Many complex strategies designed to minimize estate tax exposure – like certain types of trusts, family limited partnerships, or life insurance arrangements – might become unnecessary.

Focus Shift to Income Tax Planning: Without estate taxes to worry about, the focus would likely shift to income tax planning for heirs. You many want to talk to your financial advisor about basis step-up rules, timing of asset transfers, and other strategies to minimize capital gains taxes when assets are sold.

More Flexibility in Charitable Giving: Many wealthy individuals currently incorporate charitable giving into their estate plans. After all, charitable giving does offer tax benefits. Without estate tax incentives, charitable giving patterns might change. You might weigh philanthropic goals over tax advantages.

What does this all mean for you? If your estate might exceed the current exemption threshold (about $13.99 million for individuals or $27.98 million for married couples), now is the time to connect with an Ohio estate planning attorney. Even if your estate falls below these thresholds, tax law changes may warrant a document review or update.

Preparing for an Uncertain Future with an Ohio Estate Plan

While the DTRA represents a significant potential change, it's important to remember that tax legislation is notoriously difficult to predict. Bills can change dramatically during the legislative process, and what passes may look very different from what was initially proposed.

Given this uncertainty, how should you approach your estate planning? Here are some practical steps to consider:

• Review your current estate plan and assess how potential tax changes might affect your specific situation.

• Explore "what if" scenarios. When you work with DuPont Law Group, we'll examine the "what if " scenarios to ensure your plan remains flexible enough to adapt to various legislative outcomes.

• Consider your true legacy goals beyond tax minimization. What values, assets, and lessons do you most want to pass on to future generations?

• Communicate with loved ones who might be affected by these potential changes.

Unlike traditional estate planning, our Life & Legacy Planning Process takes a more comprehensive and adaptable approach. Our packages include regular reviews to ensure your plan evolves as laws, assets, and family dynamics change. At DuPont Law Group, we don't just help you create documents. We want to be your trusted advisors for life, proactively reaching out for updates and providing education.

Whether this act passes or not, having a comprehensive Life & Legacy Plan ensures your wishes are honored, your loved ones are protected, and your plan works the way you want, regardless of changing tax laws. 

Don't leave your loved ones’ future to chance or uncertainty. Give us a call at 614-389-9711 to schedule a consultation.