The U.S. tax landscape has undergone a historic transformation with the introduction of the One Big Beautiful Bill Act of 2025. Signed into law on July 4, 2025, this sweeping legislation makes major parts of the 2017 Tax Cuts and Jobs Act permanent, while introducing a range of new deductions and credits designed to benefit working Americans, seniors, and businesses.

As a trusted accounting firm Shah & Associates, we’re here to break down the key changes and help you understand how this new law could impact your financial future.

Key Tax Benefits for Individuals

Permanent Tax Brackets & Standard Deduction

The seven tax brackets (10%–37%) have been locked in permanently. The larger standard deductions-introduced in 2017-are here to stay, making it easier for most households to reduce taxable income without itemizing.

Bigger SALT Deduction Cap

The State and Local Tax (SALT) deduction cap has increased to $40,000, up from $10,000. However, high-income earners will see this benefit phase out as income levels rise.

Extra Support for Seniors

If you’re 65 or older, you can now claim an additional $6,000 deduction (income limits apply: $75,000 single / $150,000 married). This provision runs through 2028.

New Deductions for Tips & Overtime

For the first time, workers can deduct a portion of their extra income:

Up to $25,000 of reported tips
Up to $12,500 (single) / $25,000 (married) in overtime premiums
These deductions apply above the line-meaning you don’t need to itemize-and are valid until 2028.

Auto Loan Interest Deduction

Buying American-made cars just got more rewarding. Taxpayers can deduct up to $10,000 annually in interest on loans for vehicles assembled in the U.S.

Boosted Child Tax Credit

The Child Tax Credit rises to $2,200 per child and will now adjust for inflation each year.

Charitable Giving Deduction for All

Even if you don’t itemize, you can still deduct up to $1,000 (single) / $2,000 (married) in charitable donations.

Big Wins for Businesses

100% Bonus Depreciation Restored

Businesses can now deduct the full cost of qualifying property and equipment in the first year-permanently. This powerful change encourages reinvestment and expansion.

Qualified Business Income (QBI) Deduction Extended

Pass-through businesses can continue claiming the 20% QBI deduction, with expanded rules for small business stock and opportunity zones.

Immediate R&D and Equipment Write-Offs

Research and development expenses, along with certain equipment purchases, are now fully deductible-allowing businesses to innovate and grow more quickly.

Things to Watch Out For

Many new deductions (tips, overtime, senior benefit, auto interest) expire in 2028–2029 unless Congress extends them.
The Congressional Budget Office warns that while tax relief is broad, the bill could increase the federal deficit by over $3 trillion in the next decade.
Social program cuts tied to the bill may indirectly affect households relying on healthcare or food assistance.

Final Thoughts: Why Planning Matters

The One Big Beautiful Bill Act of 2025 creates exciting opportunities for taxpayers, but also comes with complexity and expiration dates. Whether you’re a retiree looking to maximize your new senior deduction, a family aiming to benefit from an expanded child credit, or a business owner planning big investments-strategic tax planning has never been more important.

At Shah & Associates, we help clients take full advantage of available deductions while preparing for future changes. With the right approach, you can save thousands and stay ahead of the curve.

Contact us today to schedule your tax planning consultation and secure your 2025 savings!

Contact Number : +1 (718) 725-7424

The One Big Beautiful Bill Act 2025: What It Means for Your Taxes