HOW THE BIG BEAUTIFUL BILL AFFECTS YOU

THE One Big Beautiful Bill Act, signed into law in July, has wide-reaching implications for taxpayers.

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From an enlarged standard deduction for older adults to more-generous tax credits for families with young children, the legislation contains a plethora of provisions that could lower your 2025 tax bill—or in some cases, increase it.

Just as noteworthy as the new rules are ones that extend provisions from the 2017 Tax Cuts and Jobs Act. The OBBBA makes permanent the reductions in federal income tax rates that the TCJA implemented. (Otherwise, those tax rates would have expired on December 31.) In addition, the OBBBA increases the federal estate tax exemption from $13.99 million per person in 2025 to $15 million per person, or $30 million for a married couple, in 2026; it will be adjusted annually for inflation. Without congressional action, the exemption would have dropped to about $7 million after 2025. Because of the exemption’s size, the vast majority of taxpayers don’t need to worry about paying federal estate taxes.

You may want to schedule an appointment with your financial planner or tax preparer to discuss how the bill will affect your 2025 tax liability. "You've got to run the numbers, because there's so much that's changing," says Tim Steffen, director of advanced planning at Baird. To get you started, we have guidance here on how to get the most from some of the significant provisions in the OBBBA.

A BONUS DEDUCTION FOR OLDER ADULTS