The current federal gift tax regime is favorable by historical standards. The Tax Cuts and Jobs Act (TCJA) significantly increased the unified exemption for 2018 through 2025 with annual inflation adjustments.

For 2025, the unified federal gift and estate tax exemption is $13.99 million, compared to only $5.49 million in 2017. That means you can give away that much stock, or whatever else, without owing any federal gift tax. If you give away more, the “excess gift” is taxed at a flat 40% federal rate.

However, in 2026, the unified federal exemption is scheduled to revert to the pre-TCJA level with a cumulative inflation adjustment for 2018 through 2025. If that happens, it’s estimated to be roughly $8 million. Congress is expected to extend the current exemption (or possibly make it permanent) as part of a future, comprehensive tax bill.

But nothing is certain — or truly “permanent” — in Washington, DC. Who knows what might happen after 2025?