Major Tax Reform Signed Into Law
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On July 4th, 2025, a sweeping new tax law—the One Big Beautiful Bill Act—was officially signed. This legislation marks one of the most impactful changes to the U.S. tax code in recent decades. In this article, we break down what the new rules could mean for individuals, families, and business owners alike:
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The bill makes many of the tax cuts from the 2017 Tax Cuts and Jobs Act permanent, including:
Lower individual income tax rates.
Expanded 20% pass-through deduction for business owners (Section 199A).
Increased estate and gift tax exemption (now $15M per individual)
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The standard deduction is now $29,200 for married couples filing jointly and $14,600 for single filers.
Personal exemptions remain eliminated, but the higher deduction will simplify filing for many households.
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The Child Tax Credit is now $2,200 per qualifying child under age 17.
This credit is partially refundable and phases out at higher income levels, so planning around AGI matters more than ever.
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A new deduction applies to overtime and tip income, potentially helping W-2 earners in service industries.
Auto loan interest is now deductible up to a capped amount, with phaseouts based on income.
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Higher limits for Section 179 expensing allow businesses to immediately write off qualifying purchases.
Continuation of 100% bonus depreciation through 2026, then phased down.
New clarity on LLC vs. S-Corp structures and how deductions apply under the revised rules.
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Families now receive a $1,000 contribution per child born between 2025–2028.
Additional contributions allowed up to $5,000/year per child, with tax-deferred growth.
Designed to function like a hybrid between a 529 plan and Roth IRA (though specifics vary by state).
