What The "One Big Beautiful Bill Act" Means For You

Learn what the new law's key tax provisions could mean for your finances

Thursday Aug. 7th, 2025

Adam T. Mohr (APMA®, CRPC®, CFA™, CLT®C), private wealth advisor, pictured, offers potential next steps for folks curious how the OBBBA may affect them.

On July 4, 2025, the One Big Beautiful Bill Act (OBBBA) was signed into law, making permanent several key tax provisions and introducing new ones that could impact families, retirees, and workers across the country.

This article isn’t a political statement, just a practical look at how these changes may affect your finances and how we at River Prairie Wealth Partners can help you navigate them.

Key Changes That May Affect You

Lower tax rates stay. The 2017 tax cuts – including lower income tax rates and higher standard deductions – are now permanent.

Estate and gift tax exemption extended. In 2026, the amount you can give or pass on tax-free rises to $15 million per person, adjusted for inflation.

Salt deduction boosted (temporarily). You can now deduct up to $40,000 in state and local taxes (2025–2029), with a phase-out for high earners.

Charitable giving expanded. Starting in 2026, even if you don’t itemize, you can deduct donations up to $1,000 for individuals or $2,000 for couples.

Green energy credits ending. Credits for clean vehicles and energy-efficient home upgrades expire after 2025.

For Parents & Families

Child tax credit increased. The credit now rises to $2,200 per child (starting in 2025), with inflation adjustments.

Childcare credit enhanced. More families will qualify for higher childcare tax credits starting in 2026.

New kids' savings accounts. Parents can contribute up to $5,000/year for a child’s future retirement. Newborns from 2025–2028 also get a $1,000 federal start.

529 plans expanded. More eligible education expenses now qualify, including K–12, licensing, and special needs therapies.

For Retirees

Temporary extra deduction. From 2025 to 2028, seniors age 65+ can claim a $6,000 deduction ($12,000 for couples), regardless of whether they itemize.

For Tipped & Overtime Workers

Tip income deduction: Deduct up to $25,000 in qualified tips (2025–2028).

Overtime pay deduction: Deduct up to $12,500 in OT pay ($25,000 for joint filers).

Let's Talk About Your Plan

These changes could offer new planning opportunities – but everyone’s situation is different. Let’s talk through how the new law may affect you and coordinate with your tax professional to make sure your strategy still fits your goals.

Reach out anytime – we’re here to help.

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