Now that the Congressional arm-wrestling match has concluded, the negotiations have subsided, the narrow votes have been counted, and President Trump has signed the One Big Beautiful Bill into law, you may be wondering how the provisions within its pages will impact you.

In this quick-reference summary of key provisions, I’ve outlined the recent tax law changes that may affect you:

Provisions for individual taxpayers

Without Congressional action, many provisions, including the individual income tax rates, enacted in the 2017 Tax Cuts and Jobs Act (TCJA) were set to expire at the end of 2025.

The One Big Beautiful Bill Act (OBBBA) made the lower TCJA rates permanent. All tax brackets will continue to be indexed for inflation after 2025.

The standard deduction was permanently increased beginning in 2025 to $15,750 for single filers and $31,500 for married taxpayers filing jointly. The standard deduction will be indexed for inflation after 2025.

The state and local tax (SALT) deduction cap was temporarily increased for 2025 to $40,000, up from $10,000, and will be indexed for inflation. This cap will increase by 1% annually through 2029.

In 2030, the cap will revert to $10,000. The phaseout of the deduction begins for those with modified adjusted gross income (MAGI) over $500,000 in 2025.

The OBBBA created a permanent charitable contribution deduction, which begins in 2026 for taxpayers who do not itemize their deductions and allows nonitemizers to claim a deduction of up to $1,000 for single filers or $2,000 for married taxpayers filing jointly for certain charitable contributions.

For itemizers, a 0.5% floor on the charitable contribution deduction will be imposed.

Until now, personal vehicle loan interest has not been deductible. For 2025 through 2028, a temporary interest deduction will be allowed on indebtedness incurred by the taxpayer after December 31, 2024, on new vehicle loans.

Among other parameters, the passenger vehicles must be for personal use, must be secured by the loan, and must have had their final assembly in the United States. The maximum exclusion is $10,000 per year, and the phaseout begins at MAGI of $100,000 for single filers and $200,000 for married taxpayers filing jointly.

An enhanced deduction for seniors of $6,000 per taxpayer is available to those 65 or older who use the standard deduction, as well as those who itemize their deductions.

This temporary deduction is in effect from 2025 through 2028 and phases out when MAGI exceeds $75,000 for single filers and $150,000 for married taxpayers filing a joint return.

The no tax on tips provision created a temporary deduction of up to $25,000 for qualified tips received by individuals in occupations that customarily receive tips.

This deduction is available from 2025 through 2028 for taxpayers who use the standard deduction or itemize deductions. The deduction phases out when the taxpayer’s MAGI exceeds $150,000 for single filers and $300,000 for married taxpayers filing jointly.

The no tax on overtime provision generated a temporary deduction of up to $12,500 for single filers and $25,000 for married taxpayers filing jointly for qualified overtime compensation received by an individual for tax years 2025 through 2028.

The deduction phases out when MAGI exceeds $150,000 for single filers and $300,000 married taxpayers filing jointly.

A new Sec. 1062 provision allows income tax resulting from farmland sales to a qualified farmer to be paid in four annual installments.

The lifetime gift and estate exemption amount was permanently increased, effective in 2026, to $15 million per taxpayer, indexed for inflation.

Provisions relating to children and savings plans

The OBBBA created a $1,000 tax credit for opening a Trump account for a child born between January 1, 2025, and December 31, 2028.

Trump accounts will be required to be designated as such when they are set up. (Contributions are not allowed until 12 months after the date of enactment of the OBBBA.)

Contributions can only be made in calendar years before the beneficiary turns 18 and will be capped at $5,000 a year, indexed for inflation after 2027. Distributions can only be made starting in the calendar year the beneficiary turns 18.

The child tax credit was permanently increased to $2,200 per child beginning in 2025 and will be indexed for inflation in subsequent years.

The higher income phaseout threshold amounts of $200,000 for single filers and $400,000 for married taxpayers filing jointly were also made permanent.

The maximum annual amount excludable from income under a dependent care assistance program increased from $5,000 to $7,500 under the OBBBA.

Distributions from Sec. 529 savings plans have been expanded to be used for additional educational expenses beyond tuition in connection with enrollment or attendance at an elementary or secondary school. Allowable annual withdrawals of qualified K-12 tuition expenses increased to $20,000.

Distributions for qualified postsecondary credentialing expenses are now also allowed.

Provisions for businesses

The OBBBA permanently extended the Sec. 168 first-year bonus depreciation deduction. The allowance was increased to 100% for property acquired and placed in service on or after January 19, 2025.

The form 1099 reporting threshold for certain payments to individuals engaged in a trade or business and payments of remuneration for services increased from $600 to $2,000 in a calendar year.

The provision would apply to payments made after December 31, 2025, and the threshold amount will be indexed for inflation after 2026.

Simplifying the One Big Beautiful Bill

We are happy to answer any questions you may have regarding the One Big Beautiful Bill Act. To learn more, please reach out.

Our experienced team of professionals is committed to providing customized solutions for your needs and financial goals, simplifying complex tax laws, and proactively partnering with your existing team of accountants to identify and implement strategies for tax optimization based on your unique circumstances and with your bigger financial picture in mind.

Any comments, insights, or strategies discussed in this article are intended to be general in nature and, therefore, may not be suitable for you and your situation. Tax laws are complex and may be subject to future changes or interpretations. Before acting on anything written here, please consult with your tax advisor to determine how these provisions may affect your specific situation.