The One Big, Beautiful Bill Act (OBBBA) introduces a wide range ofpermanent and temporary tax changes—and it’s normal to feel uncertainabout what it all means. This law isn’t just a headline or politicalbuzzword. It has the potential to reshape how you manage your finances,from your income taxes to your long‑term planning. The good news? With alittle clarity, you can take proactive steps to make the most of the newrules.

Income Tax, Deductions & Credits

The lower income tax brackets from the TCJA are now permanent, and youmay notice that the adjusted income thresholds could help lower youroverall tax bill. The higher standard deduction is sticking around too,continuing to rise each year with inflation—something that may simplifyyour filing process.

The Child Tax Credit is also changing. You’ll now see a combination ofrefundable and nonrefundable amounts, along with income-based phaseoutsthat determine how much you can claim. If you have younger children ordependents, these updates may impact your planning.

One of the more eye‑catching additions is the new $10,000 deduction forcar loan interest. You may qualify if your vehicle is assembled in theU.S. and meets the program’s requirements. It’s worth checking, becausethis deduction could make a meaningful difference.

If you work in a tipped occupation, you may benefit from a temporary taxbreak on up to $25,000 in tip income. The IRS will soon release the listof eligible professions, so keep an eye out.

For those living in high‑tax states, the increase in the SALT deductioncap—now up to $40,000—may offer substantial relief. Just note that thisbenefit phases out for higher earners.

Wealth Transfer, Investment & Retiree Provisions

Retirees may welcome the temporary $6,000 “Senior Bonus” deduction.Eligibility depends on your income, but if you qualify, it may loweryour taxable income in a meaningful way.

Estate planning also gets a boost. The estate, gift, andgeneration‑skipping transfer tax exemptions are now permanently increasedto $15 million, giving you more flexibility in how you transfer wealth.

If you invest regularly, the inflation‑adjusted capital gains bracketsmay help you stay in lower tax ranges depending on your income andtiming. And with permanent relief from the Alternative Minimum Tax (AMT),many taxpayers will avoid its impact—though higher‑income earners maystill phase out faster.

Other Noteworthy Changes

The OBBBA includes significant Medicaid adjustments, including$1 trillion in funding cuts, new work or volunteer requirements, andstricter eligibility criteria. If you rely on or expect to access theseprograms, these shifts may affect your planning.

The bill also creates new “Trump Accounts” for eligible children, offeringtax‑advantaged growth and defined contribution limits. These accounts maypresent new long‑term savings opportunities for families.

If you’ve been considering clean energy upgrades or an electric vehicle,act sooner rather than later—the related tax credits are being phasedout. This includes incentives for home improvements and eligible EVpurchases.

What This Means for You

The OBBBA reaches almost every taxpayer: families with young children,retirees, lower‑income households, and wealthy investors. Because the lawincludes both permanent and temporary provisions, your strategy may needadjusting sooner rather than later.

Don’t wait until tax season to understand how these changes affect you.Now is the time to review your financial plan, adjust where needed, andensure you’re making informed decisions. And if you want guidancetailored to your situation, connecting with a trusted financial advisoror tax professional can help you navigate the new landscape withconfidence.