One Big Beautiful Bill Act: What you need to know.

By Argent Wealth Management, LLC on July 11, 2025

On July 4th, 2025, President Trump signed the “One Big Beautiful Bill Act” into law. A comprehensive understanding of these changes is crucial for informed financial decision-making going forward. Given that the bill comprises over 100 provisions, we are emphasizing some of the most significant issues that may impact our clients.

This post focuses solely on provisions impacting individuals; however, we plan to provide another post highlighting the business provisions, which are significant. A few major ones include:

• Bonus Depreciation: 100% for certain property acquired 1/20/2025.
• **IRC. Sec. 1202 Qualified Small Business Stock: Adds a partial exclusion for gain on stock held for less than 5 years. 50% exclusion for stock held less than three years, 75% exclusion for stock held less than four years, and the remainder taxed at 28%. Increases per-shareholder exclusion ceiling from $10,000,000 to $15,000,000 as well as increases corporate level gross assets ceiling from $50,000,000 to $75,000,000.
  • We will provide a separate blog post as this opens up QSBS planning significantly.
• Section 179 Expense: Maximum expense increased from $1,000,000 to $2,500,000. The phaseout threshold also increased, to $4,000,000 for property placed in service after 2024.
• Qualified Small Business Income (QBI): Deduction is now permanent. The deduction stays at 20% and increases phase-in thresholds.
• Pass-Through Entity Tax Elections: No change to these deduction rules.

Individual Provisions of OBBBA

Individual income tax rates: Permanently extends expiring TCJA rates and brackets (effective 2026).

Standard deductions and personal exemptions: Permanently extends enhanced standard deduction; increases to $31,500 (Married filing jointly)/$15,750 (Single) for 2025 and inflation adjusts thereafter. Permanently eliminates personal exemptions

Enhanced deduction for seniors: Provides additional above-the-line $6,000 deduction for seniors 65+ with income phaseouts for those whose income exceeds $150,000 Married filing jointly and $75,000 Single. This is effective 2025-2028.

Social Security: Under OBBBA, Social Security benefits remain taxable for higher earners, despite new tax relief measures. For individuals with a combined income exceeding $75,000, or married couples filing jointly with incomes above $150,000, up to 85% of Social Security benefits may still be subject to federal income tax, based on existing thresholds. These unchanged thresholds, unindexed for inflation, mean higher earners must plan carefully to manage their tax liability.

**State and local taxes (SALT): Increases cap to $40,000 (MFJ and S)/$20,000 (Married filing separately or MFS) for 2025-2029, with thresholds increasing 1% each year for 2026-2029. Phases down for income >$500,000(MFJ)/ ($250,000 MFS), with a minimum allowable deduction of $10,000. Permanently caps at $10,000 starting in 2030. No change to Pass-through entity tax (PTET) deduction rules.

• We have identified significant planning opportunities here and expect to publish a blog post dedicated specifically to this issue.

Alternative minimum tax (AMT): Permanently extends prior AMT exemption amounts ($137,000 MFJ and $88,100 S). Exemption phaseout thresholds revert to 2018 levels of $1,000,000 MFJ and $500,000 S. Both amounts are indexed to inflation.

Charitable Contributions: Permanently extends 60% of AGI limit for cash contributions to public charities. Creates a 0.5% of AGI floor for individuals who itemize. Permits disallowed deductions to be carried forward only if there are other carryforwards from the current year. Permanently allows non-itemizers to deduct up to $2,000 (MFJ) and $1,000 (S).

Home Mortgage Interest: Makes permanent the limited interest deduction for mortgage indebtedness on primary and second home to $750,000. Treats some mortgage insurance premiums as qualified interest that will be effective in 2026.

Car Loan Interest: Creates an above-the-line deduction of up to $10,000 for new vehicles that were assembled in the US and purchased after 12/31/24. Includes a phaseout at a 20% rate when income exceeds $200,000 MFJ and $100,000 S. This excludes the interest paid for leased vehicles. This is effective 2025-2028.

Child Tax Credit: The Child Tax Credit has increased to $2,200 per child, indexed for inflation.

• Trump accounts for minors: Allows new tax-favored accounts to be created on behalf of a beneficiary under the age of 18. Contributions allowed no earlier than 7/4/2026. The individual contributions are capped at $5,000 and employer contributions at $2,500. These both will be adjusted for inflation. The government will also contribute $1,000 for newborns born in tax years 2025-2028.
• Please await an upcoming blog post for more details.

Estate, Gift, and Generation-Skipping Transfer (GST) Tax Provisions of OBBBA

Lifetime exemption: Permanently increases the lifetime exemption amounts to $15M per individual ($30M for a married couple). These amounts are inflation-adjusted going forward.

• Please await an upcoming blog post for more details.

If you have any questions please do not hesitate to reach out to your Financial Advisor.

Sources:

• https://www.congress.gov/bill/119th-congress/house-bill/1
• https://rsmus.com/insights/services/business-tax/big-beautiful-bill-tax.html
• https://www.whitehouse.gov/obbb/
• https://www.journalofaccountancy.com/news/2025/jun/tax-changes-in-senate-budget-reconciliation-bill/?utm_source=mnl:au&utm_medium=email&utm_campaign=03Jul2025

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