Signed in early July 2025, the “One Big Beautiful Bill” updates federal tax laws that apply to many of us. If you normally pay estimated taxes, some of these changes may warrant a recalculation before your next payment.

Here’s a high-level overview.

Permanent Changes

Key provisions of the 2017 Tax Cuts and Jobs Act (TCJA) that were due to expire at the end of this year have been made permanent:

  • Tax rates remain at 10-37%
  • No more personal exemptions
  • Nearly all miscellaneous itemized deductions (including tax prep fees—sorry!) are eliminated

Changes for 2025 and Beyond

(Some provisions expire after tax year 2028 as noted.)

Standard Deduction

  • $15,750 for single filers
  • $23,625 for heads of household
  • $31,500 for married couples filing jointly
  • Adjusts for inflation in future years

AMT (Alternative Minimum Tax): Higher exemptions and thresholds apply

Child Tax Credit: $2,200 per child, $1,400 refundable (phases out at higher incomes)

Earned Income Tax Credit: Maximum of $8,046 for households with three or more children

Estate and Gift Tax Exemption: $15 million per person, adjusting for inflation in future years

Personal Vehicle Loan Deduction: Up to $10,000 of interest on new U.S.-assembled personal vehicles (2025-2028)

Other Notable Changes

SALT (State and Local Tax) Deduction: $10,000 cap increases to $40,000 ($20,000 for Married Filing Separately) (2025-2028)

Senior Deduction: $6,000 for each 65+ taxpayer, phasing out starting at $75,000 for single and $150,000 for married filers

Qualified Business Income Deduction: A 20% deduction with higher income thresholds, along with a $400 minimum deduction for active business income

New Deductions for Tipped and Hourly Workers (2025-2028)

  • Up to $25,000 of qualified tips
  • Up to $12,500 ($25,000 joint filers) of qualified overtime
  • Subject to income phaseouts and eligibility rules

Charitable Deductions

  • Non-itemized: $1,000 ($2,000 for joint filers)
  • Itemized: Must exceed 0.5% of AGI (Adjusted Gross Income) and limited to 35% in the top tax bracket. Excess amounts can be carried forward.

Expiring Green Energy Credits

Thinking about an EV or an energy-saving home upgrade? Don’t delay.

  • EV and Clean Vehicle credits end September 30, 2025
  • Residential Clean Energy Credit expires December 31, 2025

Taken together, these changes could very well affect your 2025 tax filing—not to mention tax planning for 2026 and beyond. Contact us to discuss your situation and learn more.