A sweeping new tax bill, informally called the “One Big Beautiful Bill (OBBB)”, has been passed, bringing meaningful changes to tax brackets, deductions, and planning strategies that could affect nearly everyone.
We've summarized the key changes below with highlights on what they mean for you and how to start preparing.
1. Updated Tax Brackets – Now Permanent
The reduced marginal tax brackets from the 2017 Tax Cuts and Jobs Act (TCJA) are now permanent. This adds long-term clarity for planning and forecasting.
| Tax Bracket | Married Filing Joint | Single | Head of Household |
| 10% | $0 to $23,850 | $0 to $11,925 | $0 to $17,000 |
| 12% | $23,850 to $96,950 | $11,925 to $48,475 | $17,000 to $64,850 |
| 22% | $96,950 to $206,700 | $48,475 to $103,350 | $64,850 to $103,350 |
| 24% | $206,700 to $394,600 | $103,350 to $197,300 | $103,350 to $197,300 |
| 32% | $394,600 to $501,050 | $197,300 to $250,525 | $197,300 to $250,500 |
| 35% | $501,050 to $751,600 | $250,525 to $626,350 | $250,500 to $626,350 |
| 37% | $751,600+ | $626,350+ | $626,350+ |
2. Standard Deduction Increase
Starting in 2025, the standard deduction will increase slightly:
| Filing Status | Previous | New (OBBB) |
| Single | $15,000 | $15,750 |
| Married Filing Joint | $30,000 | $31,500 |
| Head of Household | $22,500 | $23,625 |
3. New Bonus Deduction for Age 65+
Taxpayers age 65 and older will receive an additional $6,000 deduction, phasing out at AGI over $150,000 (MFJ) or $75,000 (others). Effective 2025–2028.
4. Expanded SALT Deduction
The State and Local Tax (SALT) deduction cap increases significantly:
| Previous Limit | New OBBB Limit | Notes |
| $10,000 | $40,000 | Phases out above $500,000 AGI; increases 1%/year through 2029 |
5. Increased Child Tax Credit
Effective 2025, the child tax credit will rise and adjust annually for inflation:
| Previous | New OBBB |
| $2,000 | $2,200 |
6. Qualified Business Income Deduction (QBI)
Great news for business owners and freelancers: the 20% QBI deduction is now permanent.
New income thresholds begin phasing out at:
$150,000 (Married Filing Joint)
$75,000 (All others)
Reminder: The phase-out begins at $394,600 (MFJ) and $197,300 (others) in 2025.
7. Estate & Gift Tax Exemption Increase
The lifetime exemption increases as follows:
2025: $13.9 million
2026: $15 million per person, $30 million per couple, indexed for inflation
Additional Highlights Worth Noting:
Auto Loan Interest Deduction: New deduction (up to $10,000), phasing out above $200k (MFJ) or $100k (others).
Charitable Deduction for Non-Itemizers: $2,000 for couples, $1,000 for others, effective 2026.
"Trump Accounts" for Minors: $5,000 annual contributions + $1,000 bonus from IRS for children born in 2028.
Tips and Overtime Deduction: Up to $25,000 (MFJ) and $12,500 (Single), phasing out above MAGI limits.
529 Plan Expansion: Can now be used for elementary and secondary school costs starting in 2025.
Dependent Care FSA Limit Raised: From $5,000 to $7,000 in 2026.
| FSA Limit | Previous | New OBBB |
| Dependent Care FSA | $5,000 | $7,000 |
Business-Specific Enhancements
Section 179 Deduction: Now allows up to $2.5 million in write-offs (phases out over $4 million).
Bonus Depreciation: Returns to 100% for qualified assets placed in service after Jan 20, 2025.
Qualified Small Business Stock (QSBS):
Gross asset threshold: raised to $75 million
Gain exclusion: up to $15 million
Partial exclusions begin at 3 years (50%), 4 years (75%), and full at 5+ years (100%)
What Does This Mean for You
While many of these changes begin in 2025 or 2026, there are planning opportunities right now. Whether you’re navigating equity comp, business ownership, or retirement strategy, now is the time to revisit your financial plan.
Action items to consider:
Reassess your long-term tax and estate strategy
Consider optimizing 529 contributions or charitable giving
Prepare for expanded deductions in your 2025 financial roadmap
Let’s Talk
At Marin Wealth Advisors, we’re committed to helping you interpret complex policy changes through the lens of your goals and your life.
Call us for a check-in to talk about how the Big Beautiful Bill might impact you and how to make the most of it.