One, Big Beautiful Bill: A Reprise

Written By Larry Hall

Written by Larry Hall
July 9, 2025

Tax Relief for Individuals 

  • Standard Deduction Increased: $15,750 for individuals, $31,500 for joint filers. 

  • No Federal Tax on Tips & Overtime (OT) Pay: Through 2028, tips (up to $25,000) and OT pay (up to $12,500) are tax-free. 

  • Boosted Child Tax Credit: Now $2,200 per child, indexed for inflation. 

  • Senior Deduction: Through 2028, an extra $6,000 if you're 65+ with income under $75,000 ($150,000 joint). Phases out above $175,000 single / $250,000 joint.

  • Above the Line Charitable Deduction: Starting in 2026, non-itemizers can deduct up to $1,000 in cash gifts — $2,000 if married filing jointly. This permanent benefit excludes donor-advised funds and requires documentation for larger donations. A separate new provision limits charitable deductions for those who itemize. (Hang onto receipts for gifts over $250 to make it count.)

  • Itemized Deductions: So-called State and Local Tax (SALT) cap increases for some taxpayers through 2029 to $40,000. 

  • Estate Tax Exemption Doubled: Raised to $15 million.  

What's New for Vehicle Owners 

  • EV Tax Credits End Soon: The $7,500 credit for new EVs and $4,000 for used EVs will expire September 30, 2025. 

  • No Federal EV Tax Fee: Earlier versions proposed one, but the final bill did not include it. 

  • Auto Loan Interest Deduction: Up to $10,000 for U.S.-assembled vehicles—gas or electric. 

📌 Bottom line: If you're eyeing an electric vehicle, the clock is ticking. 

Business Incentives 

  • Immediate Expensing: For equipment and R&D.

  • Semiconductor Tax Credit: 35% if building plants in the U.S. by 2026. 

  • Clean Energy Credits Repealed: Say goodbye to federal incentives for solar panels and EV charging stations after Sept. 30, 2025. 

Social Program Cuts & Work Requirements 

  • Medicaid & SNAP Cuts: $1.2 trillion over 10 years, with new 80-hour/month work requirements for many adults. 

  • Medicaid Co-Pays: $35 per visit in many states. 

  • Eligibility Tightened: Especially for childless adults under 65. 

Where the Money’s Going 

  • Border Security: $350 billion, including more ICE agents and detention beds. 

  • Defense Spending: $25B for missile defense, $12.5B for air traffic modernization. 

  • Rural Healthcare: $50B investment in hospitals over five years. 

Fiscal Impact on US Government  

The Congressional Budget Office estimates the new tax bill will add $3 trillion to our national debt over the next 10 years. That’s on top of the current US Federal debt of $36 trillion, and on top of the $2 trillion in annual deficit spending which also adds to the debt each year. 

💡 Planning Ahead

With the most significant tax law overhaul since 2017 now in effect, this is a smart time to revisit your tax strategy. While this article outlines key changes, every tax situation is different. Whether you're retired, working, or running a business, thoughtful planning can make a meaningful difference.

Curious what this means for you? Schedule a consultation or reach out through my Contact page — I’m here to help.

This article is for informational purposes only and does not constitute professional tax advice. For guidance on your specific situation, consult a qualified tax professional.

📚 Sources & Further Reading

Larry Hall

Lawrence (Larry) Hall, CPA, is a Grantham, New Hampshire based tax professional. He holds MS in Accounting and MBA degrees from Plymouth State University, where he taught accounting for several years. He thinks a lot about tax matters so you don’t have to.

https://HallTaxPro.com
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