The newly signed One Big Beautiful Bill brings sweeping changes to individual taxation and estate planning — offering more certainty, expanded deductions, and significant planning opportunities for American families across income levels.

Individual Tax Updates

One of the biggest wins for taxpayers is the permanent extension of the lower income tax brackets — including the 10%, 12%, and 22% rates — with an additional year of inflation adjustment. The enhanced standard deduction is also now permanent, starting at $31,500 for joint filers in 2025.

Other permanent changes include:

  • The elimination of personal exemptions is now permanent
  • The $750,000 mortgage interest deduction limit is locked in
  • The child tax credit increases to $2,200 in 2026 and will adjust for inflation

New Temporary Deductions (2025–2028)

The bill introduces several time-limited deductions worth knowing about:

  • A $6,000 senior deduction, phasing out at incomes above $75,000
  • Up to $25,000 of deductible tip income for workers in tipped industries
  • An overtime premium deduction of $12,500 for single filers and $25,000 for joint filers
  • A $10,000 deduction for auto loan interest on U.S.-assembled vehicles

Charitable Giving and High-Earner Rules

Charitable giving gets a permanent boost with a new above-the-line deduction of $1,000 for individuals and $2,000 for joint filers, plus a 0.5% floor for itemized charitable deductions.

High earners should note: itemized deductions will be limited to 35 cents per dollar for top-bracket taxpayers. The SALT deduction cap rises to $40,000 in 2025, then gradually phases back down to $10,000 by 2030.

Estate Tax Updates

For wealth transfer planning, the estate and lifetime gift tax exemption rises permanently to $15 million for single filers and $30 million for joint filers beginning in 2026, with annual inflation adjustments going forward. This is a significant change that creates new planning opportunities for families thinking about long-term wealth transfer.

What This Means for You

These changes are designed to provide long-term clarity and expanded deductions for taxpayers at every income level. Whether you’re planning for retirement, managing an estate, or simply trying to reduce your annual tax bill, now is a great time to revisit your strategy. Contact us at 708-665-6663 or marketing@4wealthfg.com. Or, visit 4wealthadvisors.com/get-in-touch to fill out our contact form.