What Does the One Big Beautiful Bill Mean for You?

The One Big Beautiful Bill (OBBB) was signed into law on July 4, 2025, and marked one of the most significant shifts in tax law in recent years. Some notable changes include the addition of new deductions and tax credits aimed at families, workers, and businesses, and alterations to benefit programs and environmental incentives. Plus, the OBBB makes many provisions from the 2017 Tax Cuts and Jobs Act permanent.

While some updates offer stability, others are temporary or are contingent on factors that may not apply to every individual. This blog breaks down what’s in the bill and what it means for your individual wealth or your business finances.

Tax Stability and Permanence

Standards from the 2017 tax law were set to expire after 2025; now, they’re locked in. This means:

• Individual tax brackets (10%–37%) remain in place instead of going back to pre-2017 numbers.
• The standard deduction stays higher ($31,500 for married couples filing jointly, $23,625 for heads of household, and $15,750 for single filers).
• The Qualified business income (QBI) deduction for pass-through businesses remains part of the tax code.

These adjustments bring consistency, though not necessarily lower tax rates for everyone. Take-home pay still depends on income level, deductions, and state of residence.

What OBBB Means for Individuals and Families

For everyday taxpayers, the bill brings tax credits that can benefit families and some workers. But it also introduces stricter eligibility for some safety-net programs.

Key Provisions:

• Child Tax Credit: Raised to $2,200 per child, with a portion refundable. Applies only to qualifying dependents and is indexed for inflation.
• Dependent Credit: $500 for other qualifying dependents, such as elderly parents.
• Senior Deduction: Taxpayers of 65 years or older can claim an extra $6,000 (or $12,000 for married couples filing jointly where both filers are 65 years old or older) standard deduction through 2028. However, this amount starts to phase out for individuals making more than $75,000 (or joint filers making more than $150,000). Seniors with an income of $175,000 and couples with a combined income of $250,000 are not eligible for this deduction.
• SALT deduction cap: The cap on deducting state and local taxes (SALT) is temporarily raised to $40,000 for tax year 2025—but it’s scheduled to return to lower levels after 2029 unless Congress acts again.
• Car loan interest deduction: Individuals can deduct up to $10,000/year in interest from car loans for U.S.-assembled vehicles purchased between 2025 and 2028. Income limits and other restrictions apply.
• “Trump Accounts”: The new tax-deferred savings accounts for children born between 2025 and 2029 allows families to contribute up to $5,000/year, and the money can be used for education, medical expenses, or first-time home purchases starting at age 18.
• Major federal tax credits and some rebate programs for energy-efficient home improvements are expiring at the end of 2025. This includes the Energy Efficient Home Improvement Credit (25C) and the Residential Clean Energy Credit (25D), which provided significant tax savings for upgrades like solar panels, efficient windows, and heat pumps.

What OBBB Means for Businesses

Business owners gain several permanent tax advantages. The 20% deduction for QBI is now permanent, offering clarity to owners of pass-through entities. The bill also makes 100% bonus depreciation permanent, allowing companies to fully expense capital investments right away.

Workforce Related Updates

• Tips and Overtime Pay: Starting in 2025, tips and part of overtime income are no longer taxable. What’s important for employees to know is that only the “extra” portion (the half-time premium) is tax free. For example, if an employee normally earns $20/hour and makes “time and a half” ($30/hour) for overtime, only the extra $10 is tax-deductible. For employers, regular payroll tax rules still apply. But employers must report the portion of the employee’s pay that is qualified overtime separately on the W-2 form.
• Section 179D (Energy Efficient Commercial Buildings Tax Deduction): It’s been 20 years since the Energy Policy Act of 2005, which included Section 179D to reduce energy use, was signed into law. Businesses will no longer be able to claim this deduction starting in July of 2026. The OBBB phases out the popular deduction, but projects that begin construction before July 1, 2026 can still qualify, even if they’re completed later. This change affects developers, building owners, and contractors who’ve used 179D to offset costs for installing high-efficiency HVAC, lighting, and building envelope systems.

Business owners should evaluate how these provisions affect entity structure, capital investment plans, and workforce benefits. Not all companies will benefit equally, as outcomes depend on industry, size, and workforce composition.

How to Understand the Major Shift

The One Big Beautiful Bill reshapes both personal and business taxes by locking in lower rates, expanding deductions, and introducing new but sometimes temporary credits. At the same time, it trims certain safety net and environmental programs, showing the trade-offs built into the law.

For most individuals and families, this means greater certainty in planning, but also the need to track which benefits are temporary. Tax law is always evolving, and while the OBBB settles some questions, it also raises new ones. It’s normal to feel uncertain about what applies to you. That’s why professional guidance is so valuable.

Don’t navigate this alone. A trusted CPA at Cukierski & Associates can help you interpret the OBBB, adapt to ongoing tax changes, and ensure your financial strategies, whether personal or business, are aligned with your goals and obligations. Reach out to us!