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The One Big Beautiful Bill Act - How it Affects You

The One Big Beautiful Bill Act (OBBBA), signed into law on July 4, 2025, introduces sweeping changes to the U.S. tax code. Many provisions from the 2017 Tax Cuts and Jobs Act are now made permanent, while new rules have been added that could significantly shape your financial plan. Understanding these changes can help you anticipate the financial impact on your household, your business, and the broader U.S. economy.

If you'd like to confirm how your financial plan will be impacted, call U.S. Central Financial Group today to get more information.

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General Income Tax Provisions

  • Tax Rates Made Permanent – Tax brackets ranging from 10% to 37% are permanently extended.
  • Alternative Minimum Tax (AMT) – Higher exemption amounts are locked in, indexed for inflation starting in 2026.
  • Increased Standard Deduction – Permanently raised to $15,750 for individuals and $31,500 for married couples (2025 values, indexed for inflation).
  • Elimination of Personal Exemptions – The removal of personal exemptions, first introduced in 2017, is now permanent.

Key Deduction and Credit Changes

The main deduction and credit changes you need to consider are:

  • Charitable Deduction for Non-Itemizers – Beginning in 2026, single filers may deduct up to $1,000 and joint filers up to $2,000, even if they don’t itemize.
  • “Bonus” Deduction for Seniors – Those age 65+ can claim an additional $6,000 deduction through 2028, phased out for higher earners.
  • Temporary Auto Loan Interest Deduction – Up to $10,000 in auto loan interest can be deducted for tax years 2025–2028.
  • Child Tax Credit – Increased to $2,200 for 2025, with annual inflation adjustments thereafter.
  • Scholarship Credit – Starting in 2027, 100% credits on cash donations to approved scholarship organizations, up to $1,700 per taxpayer.
  • Increased State and Local Tax (SALT) Deduction: The SALT deduction cap is temporarily increased to $40,000 for taxpayers earning under $500,000, effective through 2029. Afterward, the cap reverts to the current $10,000.

Estate and Gift Tax Updates

For families planning their legacy, the Act permanently increases the estate and lifetime gift tax exemption to $15 million for single filers and $30 million for joint filers starting in 2026.

This change has direct implications for wealth transfer strategies and long-term estate planning.

Business and Investment Provisions

  • Qualified Business Income Deduction – The 20% QBI deduction is now permanent, with income thresholds set at $75,000 (single) and $150,000 (joint).
  • Bonus Depreciation – Reinstated and made permanent for qualifying property purchased after January 19, 2025.
  • Small Business Expensing Cap – Increased to $2.5 million beginning in 2025.
  • Qualified Opportunity Zones (QOZs) – Extended through 2026, with expanded reductions on deferred capital gains tax.
  • Qualified Small Business Stock (QSBS) – New holding period rules provide phased exclusions (50% after 3 years, 100% after 5 years).

Tax-Favored Accounts

  • 529 Plans – Expanded to cover homeschool and secondary credentialing.
  • ABLE Accounts – Enhanced contribution limits and rollover options.
  • “Trump Accounts” – A new savings vehicle for children born between December 31, 2024, and January 1, 2029, offering up to $1,000 in government seed funding and $5,000 annual contributions.

What This Means for Your Financial Plan

The One Big Beautiful Bill Act introduces opportunities and challenges. Lower tax rates, larger deductions, and expanded credits may provide relief for many families, while business owners may benefit from permanent QBI deductions and higher expensing caps. At the same time, new provisions around estate taxes and investment accounts require thoughtful integration into your financial strategy.

The potential change in taxes will vary by household, but proactive planning can help minimize surprises and align your strategy with the law’s long-term provisions.

Take the Next Step

The financial impact of the One Big Beautiful Bill Act will depend on your income, assets, and personal circumstances. At U.S. Central Financial Group, we help clients review these changes and adjust their financial plan to fit both immediate needs and long-term goals. Contact us today to schedule a consultation and learn how this legislation may affect your future.

At US Central Financial, we provide experienced advice to guide you through these upcoming changes. Contact us today to learn more!