I’m 62 and worth millions: how can I give more to my kids without getting slammed on taxes?

I’m 62 and worth millions: how can I give more to my kids without getting slammed on taxes?

John Seetoo

Sun, September 6, 2026 at 4:15 PM GMT+3 7 min read

Quick Read

• Ramsey endorsed structuring a $300,000 family business loan repaid via annual $19,000 tax-free gifts, keeping transfers off IRS radar year by year.

• The One Big Beautiful Bill Act permanently raised the federal lifetime gift and estate tax exemption to $15 million per individual, effective January 1, 2026.

• An estate valued between $10 million and $12 million may owe zero federal tax yet still face heavy state liability, with exemptions as low as $1 million in Oregon.

• Many financial professionals are salespeople paid on what they push, not whether you end up wealthier. A fiduciary is the opposite. The SEC legally requires them to put your interests first. Advisor.com's free matching tool pairs you with vetted fiduciaries from major national firms, all in under three minutes. See who you match with today.

Benjamin Franklin is famous for many things, including this observation: Our new Constitution is now established, and has an appearance that promises permanency; but in this world nothing can be said to be certain, except death and taxes.

Death and taxes are two dreaded topics that seldom travel far apart. Their confiscatory logic is a persistent source of frustration and creative planning, as families search for legal ways to transfer wealth without surrendering more than necessary to the government. Congress and the IRS created gift taxes specifically to discourage asset transfers made before death as a way to sidestep estate taxes. Those estate levies, sometimes called Death Taxes, apply to the total value of an estate at the moment the owner passes.

Dave Ramsey co-hosts The Ramsey Show, a nationally syndicated program devoted to personal financial advice. He recently tackled the topic of gifting when a caller wanted to give a large sum to his son-in-law for expanding a business without triggering gift taxes.

The Caller's Dilemma

Dave Ramsey's syndicated radio show regularly gives financial tips to listeners seeking guidance.

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The caller, a 62-year-old with a net worth of $10 million to $12 million, wanted to fund the expansion of his son-in-law's musical instrument repair business. His proposed structure was practical: treat the initial $300,000 as a mortgage or property loan note, giving the son-in-law the capital to purchase or rent a larger workshop space. From there, annual cash gifts below the $19,000 exclusion threshold (or $38,000 for married couples using gift-splitting) would gradually pay down the loan balance, keeping the transfers off IRS radar year by year.

Ramsey's Advice

Ramsey endorsed the caller's approach and offered a complementary alternative worth examining. His suggestion: apply the $300,000 directly against the federal lifetime estate and gift tax exemption, treating it as a declared gift rather than a loan. That path became considerably more attractive after the One Big Beautiful Bill Act (OBBBA), signed into law on July 4, 2025, permanently raised the unified exemption to $15 million per individual (or $30 million for married couples) beginning January 1, 2026, up from $13.99 million in 2025. Before the OBBBA, the Tax Cuts and Jobs Act exemption was set to sunset after 2025 and revert toward roughly $7 million per person, a prospect that had many wealthy families scrambling. The new law removes that cliff entirely. The exemption is indexed for inflation annually from 2027 onward, and the top marginal rate on amounts above the threshold remains 40%.

Several practical points flow from this framework. Using the Unified Estate Tax Credit during one's lifetime reduces the amount shielded at death, but the expanded $30 million combined baseline for married couples substantially widens the margin of safety for most high-net-worth families. At 62, the caller's estate will likely continue to grow, yet the permanently enlarged threshold reduces the risk of outgrowing the exemption by tapping it early. Annual exclusion gifts of $19,000 per recipient, the confirmed figure for both 2025 and 2026, also benefit from inflation-adjusted increases over time, so the installment paydown strategy compounds in the caller's favor. Ramsey further noted that loan forgiveness could be built into the caller's will, and that a simple one-page loan record, initialed each year, satisfies the IRS documentation standard.

State-Level Tax Traps to Consider

Federal relief is meaningful, but state-level rules add a layer of risk that many families underestimate. Twelve states and the District of Columbia levy their own estate taxes, and five states (Kentucky, Maryland, Nebraska, New Jersey, and Pennsylvania) impose separate inheritance taxes. Iowa completed its phaseout of the inheritance tax for deaths on or after January 1, 2025, trimming that list from six states to five. State decoupling thresholds can be startlingly low: Oregon sets its exemption at just $1 million, while Rhode Island's threshold sits at roughly $1.8 million. An estate worth $10 million to $12 million could owe no federal tax whatsoever while still facing a six-figure state bill, depending entirely on where the owner lives.

Takeaways and 24/7 Key Points:

Both the caller's plan and Ramsey's alternative rest on established tax mechanics and are structurally sound. One additional avenue worth exploring: if the son-in-law's business eventually attracts outside investors or a buyout from a larger competitor, structuring the funding along venture capital lines could make sense. The vehicle for that is typically a Simple Agreement for Future Equity (SAFE) or a Convertible Promissory Note. The trade-off is that payments under those instruments would generate a 1099 tax event for the caller.

Equity instruments and SAFEs also carry a balance-sheet benefit. Keeping the original capital outside the workshop's senior debt load improves the business's prospects for commercial bank financing or institutional backing later. If the funding converts to corporate equity, any distributions that follow are treated as qualified dividends, taxed at long-term capital gains rates rather than the ordinary income rates that apply to imputed interest.

Advanced Wealth Transfer Alternatives

For high-net-worth positions that exceed standard planning limits, other structures offer lasting utility. A Family Limited Partnership (FLP) lets parents consolidate business assets while retaining control as general partners and distributing non-voting limited partner interests to descendants. Because non-voting equity lacks marketability, valuation discounts typically reduce the taxable value of each transfer. Intentionally Defective Grantor Trusts (IDGTs) serve a complementary goal: they freeze asset values for estate purposes while allowing the grantor to cover the trust's income tax liability out of pocket, effectively delivering an additional tax-free benefit to beneficiaries over time. Both tools remain fully available and are unaffected by the OBBBA, making them relevant even for estates that now fall comfortably below the $15 million federal threshold but face exposure at the state level.

This article is intended to be strictly informative and opinion-based only, and not construed to be tax or financial advice. It is advised that professional tax and financial counseling be sought before undertaking any steps in that field.

Editor's note: This pass corrects the two states cited as having the nation's lowest estate-tax exemptions: the accurate pair is Oregon (at $1 million) and Rhode Island (at roughly $1.8 million), not Oregon and Massachusetts. It also adds context explaining that the TCJA's elevated exemption was originally set to sunset after 2025 and revert toward roughly $7 million per person, which frames why the OBBBA's permanent $15 million baseline was a significant change for high-net-worth families. The Advanced Wealth Transfer section now notes that FLPs and IDGTs remain unaffected by the OBBBA.

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