President Donald Trump’s Big Beautiful Tax Bill is a landmark tax reform package signed into law by the Senate and House of Representatives to deliver sweeping tax relief for millions of Americans. 

This White House initiative locks in permanent tax cuts, builds on the 2017 Tax Cuts and Jobs Act, and expands key tax breaks for individuals, real estate investors, and families—making lower brackets and higher deductions permanent while adding new tax benefits.

The Big Beautiful Bill introduces fresh ways to ease the burden of federal, state, and local tax liabilities, from deductions on car loan interest to write-offs for charitable giving and even tax relief on income from tips. Whether you’re a W-2 employee, landlord, retiree, or small business owner, this tax reform delivers targeted tax breaks that could save you thousands on your income taxes.

But here’s the catch: You need to know how and when to use these provisions. Let’s walk through the most impactful Trump tax cuts so you can plan ahead and keep more of what you earn.

Summary of Trump’s Big Beautiful Bill Tax Overhaul

There are 13 impactful tax breaks from the Big Beautiful Bill that are driving economic growth, lowering federal taxes, and extending tax cuts indefinitely for individuals:

1. Tax Brackets Made Permanent – Long-term stability for income earners and investors
2. Standard Deduction Boost – Simplified filing and bigger tax savings for 90% of Americans
3. Senior and Retiree Benefits – Expanded deductions and special breaks for taxpayers 65+
4. Tax on Tips and Overtime Relief – New deductions designed for working-class Americans
5. Child & Adoption Tax Credits – Larger, refundable credits for families
6. Trump Accounts – $1,000 investment credits for newborns to encourage long-term savings
7. Federal Government Deduction Changes – Elimination of outdated write-offs, simplification of itemization
8. Charitable Contribution Enhancements – Above-the-line deductions and itemized strategy updates
9. Homeowner Tax Relief – Mortgage interest and insurance deductions that support property owners
10. Auto Loan Interest Deduction – Temporary federal tax relief on new car purchases
11. Alternative Minimum Tax Reform – Adjustments to protect middle-income earners
12. Estate Tax Exemption Expansion – $15M+ exclusion ensures legacy protection for families
13. HSA Expansion & Telehealth Eligibility – Triple tax advantage and more flexibility for health savers

Watch Toby Mathis and former IRS lead trial attorney Scott Estill walk through the Big Beautiful Tax Bill in real time. Click here for the full video breakdown and discover how to apply these tax-saving strategies to your own situation.  Or if you want to know how the bill will impact business, check out part 2 here.

1. Extended Tax Brackets

The top marginal tax rate of 37% is here to stay. The Big Beautiful Bill makes the Trump-era tax brackets permanent, blocking a return to the 39.6% top rate.

Why This Matters:

• Prevents a major tax increase for high-income earners and successful investors
• Preserves the current bracket structure, with inflation adjustments to prevent “bracket creep”
• Creates long-term predictability for estate planning, Roth conversions, and retirement distributions

This benefits wage earners, real estate investors, and small business owners alike by offering clear thresholds for multi-year tax planning strategies.

2. Standard Deduction Increases

The standard deduction is permanently increased to:

• $15,750 for single filers
• $31,500 for married couples filing jointly

Nearly 90% of Americans now take the standard deduction, especially after the TCJA eliminated many miscellaneous deductions. This makes tax filing simpler and more streamlined—no more shoebox of receipts just to claim basic write-offs.

Who Benefits:

• W-2 employees with minimal itemized deductions
• Retirees on fixed incomes
• Families who previously used itemized deductions but fall under the new caps

3. Senior Deductions

Americans 65 and older can now deduct an additional $6,000 per person—that’s $12,000 per couple—on top of the standard deduction.

Income Phaseouts:

• Begins phasing out at $75,000 AGI for singles
• Phases out at $150,000 AGI for married couples

This enhanced deduction is available through 2028, offering a critical tax break for older Americans on Social Security, pensions, or retirement distributions.

4. Tips and Overtime Deductions

For workers in the service or hourly workforce, the bill introduces deductions—not credits—for tips and overtime:

• Tip Deduction: Up to $25,000/year in eligible industries (e.g., food service, hospitality)
• Overtime Deduction:
  • Up to $12,500/year for single filers
  • Up to $25,000/year for married joint filers

Important Details:

• Deductions begin to phase out at $150,000 AGI (single) or $300,000 (married)
• Employment taxes still apply
• States may or may not recognize this deduction

These are federal deductions. Check with your CPA to confirm state treatment.

5. Child Tax Credit & Adoption Credit

Child Tax Credit:

• Permanently set at $2,200 per qualifying child
• $1,700 is refundable, meaning you receive it even if your tax bill is zero

Adoption Tax Credit:

• Raised to $17,000 per adopted child
• Now partially refundable, helping adoptive families get a bigger refund

These are credits, reducing your tax bill dollar-for-dollar.

6. Trump Accounts (Child Investment Credits)

Parents of children born between 2025 and 2028 receive a $1,000 tax credit for funding a new savings account tied to index funds (e.g., S&P 500).

• Additional contributions up to $5,000/year allowed
• Distributions are taxed as ordinary income

Planning tip: Combine this with other savings tools (529, HSA, Roth) for optimal long-term growth.

7. Elimination of Miscellaneous Deductions

The bill permanently eliminates several common but messy itemized deductions:

• Tax prep software and professional fees
• Investment management fees
• Union dues and work uniforms
• Safe deposit boxes

8. Charitable Deduction Changes

• Non-itemizers can deduct up to:
  • $1,000 (single)
  • $2,000 (married filing jointly)
• Itemizers now face:
  • A 0.5% floor before deductions count
  • A cap at 35% of income

2025 planning strategy: Use a Donor-Advised Funds before these new limits take effect in 2026.

Workaround Strategy: Shift expenses related to business or rental activity to a business entity (such as an S-Corp or LLC) to keep them deductible under Section 162.

9. Mortgage Interest & Insurance Deduction

What’s Deductible:

• Mortgage interest on debt up to $750,000
• Mortgage insurance premiums (PMI) now deductible again
• Applies only to acquisition debt or improvements (no cash-out refinancing for vacations)

Not Deductible:

• Interest from equity loans used for non-property purposes
• Second homes with debt above allowable limits

This provision is especially important for homeowners in high-cost areas or real estate investors with high leverage.

10. Car Loan Interest Deduction

You can now deduct up to $10,000/year in interest on a new car loan—a first in decades for individual taxpayers.

Requirements:

• Vehicles must be assembled in the U.S.
• Must be a new vehicle
• No itemization needed—this is an above-the-line deduction

Phaseouts:

• Begins at $100,000 AGI (single) and $200,000 (joint)
• Fully phased out at $149,000 / $249,000

This benefits working-class Americans and provides an incentive to buy American-made vehicles.

11. Alternative Minimum Tax (AMT)

Lawmakers originally created the AMT to ensure high-income earners paid a minimum tax, but it often ended up impacting the middle class.

Updates Under the Bill:

• Exemption thresholds raised to:
  • $88,000+ for singles
  • $137,000+ for married joint filers
• Indexed for inflation

Most taxpayers will now be unaffected by the AMT unless they trigger it with high write-offs or large incentive stock options.

12. Estate Tax Lifetime Exemption

The estate and gift tax exemption is now:

• $15 million per person
• $30 million per married couple

This includes business interests, real estate holdings, life insurance, and investment portfolios.

Why this matters:
Without proactive estate planning, heirs could face up to 40% in federal estate taxes—plus state-level estate or inheritance taxes in certain jurisdictions.

Action Step: You should revisit your trusts, gifting strategies, and how your assets are titled to make the most of this exemption while it lasts.

13. Expanded HSA Access

Health Savings Accounts (HSAs) get a powerful upgrade:

• 2025 contribution limits: ~$8,300 for families
• Broader plan eligibility (including telehealth)
• Triple tax benefit:
  • Contributions are tax-deductible
  • Growth is tax-deferred
  • Withdrawals are tax-free if used for qualified medical expenses

Investor Strategy: Use an HSA like a stealth retirement account. Pay medical costs out of pocket now, and reimburse yourself tax-free years later for big-ticket healthcare expenses.

Ready to Plan Ahead?

If you’re wondering how these new rules apply to your situation—or how to use them to reduce your tax bill this year—schedule a free 45-minute Strategy Session with our Senior Advisors. 

Final Thoughts

Trump’s Big Beautiful Bill is packed with tax-saving opportunities for individuals—but the real winners will be those who plan early and structure things the right way.

Whether you’re a W-2 earner, small business owner, or real estate investor, there’s something here for you. But timing and structure matter. Talk to your advisor and make sure you’re capturing every dollar you can.