The One Big Beautiful Bill Act

July 9, 2025

The House of Representatives passed the final version of the One Big Beautiful Bill Act (OBBB) on July 3, 2025, following a razor-thin 51-50 Senate vote that initially propelled the bill forward. Now with President Trump’s signature on July 4^, 2025, this landmark legislation is officially law—ushering in a new era for your wallet, your business, and your future tax planning. Let’s break down some of the larger legislation behind what’s happening, and what you need to watch for next.

Before you start reworking your tax strategy, here’s what you need to know:

• The OBBB is now law: After a dramatic Senate vote and more than fifty amendments, the reconciled bill passed both chambers and was signed by the President. The provisions are now in effect for tax years beginning in 2025.

• What’s next: Implementation details are rolling out, with the IRS and Treasury expected to issue guidance on technical aspects in the coming months. Some provisions are permanent, while others are temporary—so strategic tax planning is more important now than ever.

• Bottom line: The OBBB’s sweeping changes are now reality. If you haven’t already, it is time to review your tax strategy and consult your CPA or financial advisor to take full advantage of the new rules.

  
  

What’s Inside the OBBB? Key Provisions at a Glance – Individuals, Businesses, & Real Estate

Individuals:

1. Tax Cuts and Jobs Act Extensions

• Income Brackets: The bill extends the higher income brackets from the 2017 Trump tax cuts, maintaining lower rates for many households.

• Standard Deductions: The increased standard deduction from the 2017 tax cuts is extended, providing continued tax savings for millions.

2. Senior Tax Deduction

• New Deduction: Seniors aged 65 and older can now claim a special deduction of $6,000 for individuals or $12,000 for couples, available from 2025 to 2028. The deduction phases out for incomes above $75,000 ($150,000 for couples) and ends at $175,000 ($250,000 for couples). Seniors should plan ahead to make the most of this limited-time benefit.

3. Small Business Stock Gain Exclusion

• Long-Term Incentives: The bill allows exclusion of gain from small business stock from gross income by the following amounts.

  • 50% exclusion for stock held 3 years

  • 75% exclusion for stock held 4 years

  • 100% exclusion for stock held 5 years or more

4. Estate & Gift Tax Reform

• Permanent Exemption: The estate and gift tax exemption is now permanently set at $15 million per individual, indexed for inflation, starting in 2026.

5. Child Tax Credit

• More Support: The credit increases permanently to $2,200 per child.

6. Alternative Minimum Tax (AMT)

• Broader Relief: The bill permanently extends higher AMT exemption amounts, providing ongoing relief for high-income earners.

7. Charitable Contributions for Non-Itemizers

• New Deduction: Deduct $1,000 ($2,000 for joint filers) in charitable donations, even if you don’t itemize.

8. Trump Accounts

• Savings Account: The bill proposes “Trump Accounts,” tax-advantaged savings accounts for children. Key features:

  • Up to $5,000 annual contribution until age 18

  • Earnings grow tax-deferred; withdrawals taxed as long-term capital gains

  • Partial access at age 18 for education, business, or home purchase; full access at 25, unrestricted at 30

    • Note: Withdrawals are not strictly limited to the age of 18; phased access is allowed.

  • A one-time $1,000 government deposit for children born after December 31, 2024, and before January 1, 2029

9. SALT Deduction Cap Raised

• Bigger Deductions: The State and Local Tax (SALT) deduction cap increases from $10,000 to $40,000 for five years, then reverts. The higher cap phases out for incomes above $500,000

10. No Tax on Tips and Overtime

• Tips: Workers in qualifying industries can deduct up to $25,000 in tip income (phasing out above $150,000 for individuals, $300,000 for joint filers).

• Overtime: Deduct up to $12,500 (single) or $25,000 (joint) in overtime earnings (phasing out above $150,000 for individuals, $300,000 for joint filers). These provisions are temporary (2025–2028).

  
  

Businesses:

1. QBI Deduction Made Permanent

• Certainty for Entrepreneurs: The 20% Qualified Business Income deduction for pass-through businesses is now permanent.

2. Bonus Depreciation Returns

• Full Expensing: 100% bonus depreciation is made permanent for property placed in service after January 19, 2025.

  
  

Real Estate

1. Permanent Incentives

• Expansion: The bill expands and enhances rules for opportunity zones, low-income housing tax credits (LIHTC), and new markets tax credits. Notably, LIHTC receives a significant expansion, and opportunity zone eligibility is tightened to focus on more distressed areas

2. Farmland Sales Installment Plan

• Farmland sales: The bill allows taxes on profits from selling qualified farmland to eligible farmers to be paid over a four-year period.

  
  

What Does This Mean for You?

• Wage Earners: Deductions for tips and overtime may lower taxable income (2025–2028).

• Families: Expect a larger child tax credit and a higher SALT deduction cap.

• Business Owners & Investors: Permanent QBI deduction and permanent 100% bonus depreciation offer strong incentives for growth.

• High-Net-Worth Individuals: The higher estate and gift tax exemption and permanent AMT reduction opens new planning opportunities.

  
  

What’s Next?

The OBBB is now law and set to reshape tax planning for years to come. With the President’s signature on July 4, 2025, these sweeping changes are officially in effect. Stay tuned for further updates as the IRS and Treasury release implementation guidance and technical details. To make the most of the new provisions—some of which are temporary while others are permanent—consider consulting your CPA or financial advisor. In tax planning, timing and proactive strategy are more important than ever.