While most Americans were celebrating Independence Day with barbecues and fireworks on July 4th, 2025, President Trump was signing what may be the most significant tax legislation since the Tax Cuts and Jobs Act of 2017. The nearly 900-page “One Big Beautiful Bill” has created unprecedented opportunities for business owners, retirees, and high-net-worth individuals—but only for those who understand how to leverage them.
After spending weeks analyzing this comprehensive legislation, I’ve identified five major changes that could fundamentally alter your tax and estate planning strategy for decades to come. More importantly, several of these opportunities are time-sensitive, meaning the families who act quickly will benefit most
The Estate Tax Revolution: $30 Million for Married Couples
What Changed: The estate tax exemption has been increased from the current $13.99 million per person in 2025 to $15 million per person ($30 million for married couples) starting in 2026, and this increase is now permanent—no more sunset clauses.
Why This Matters: If you’re a business owner who’s been stressed about giving away millions in assets by the end of 2025 to avoid the “tax cliff,” you can breathe easier. Instead of your exemption being cut in half in 2026, it’s actually being increased.
Strategic Opportunities:
- For Ultra-High-Net-Worth Families: Your fundamental gifting strategy remains the same—continue making lifetime gifts to remove future appreciation from your estate.
- For $15-30 Million Estates: You now have a choice. Instead of rushing to gift assets away, you might benefit more from holding appreciating assets until death to provide your heirs with stepped-up basis, potentially eliminating decades of capital gains taxes.
- For Everyone: The permanent nature of this exemption allows for long-term succession planning without worrying about future legislative changes.
Real-World Example: If you own $25 million in highly appreciated real estate, under the old rules you would have been scrambling to gift half of it away. Now you might be better off holding it and letting your heirs receive it with stepped-up basis.
SALT Deduction Breakthrough: Up to $40,000 in New Deductions
What Changed: The State and Local Tax (SALT) deduction cap increases from $10,000 to $40,000 for tax years 2025-2029, with annual inflation adjustments. The benefit phases out for taxpayers with adjusted gross income above $500,000.
Why This Matters: If you live in a high-tax state, this could save you thousands in federal taxes annually.
Strategic Opportunities:
- Accelerate SALT Payments: Pay your 2025 property taxes early and accelerate state income tax payments to maximize the benefit during the 2025-2029 window.
- Income Spreading: If you’re near the $500,000 phase-out threshold, consider strategies to spread income across multiple years or use multiple non-grantor trusts.
- Bunching Strategy: Concentrate deductible expenses into the 2025-2029 period when the higher cap is available.
Real-World Example: If you’re paying $45,000 in state income taxes and $25,000 in property taxes ($70,000 total), and your income is under $500,000, you can now deduct $40,000 instead of the previous $10,000 limit—potentially saving you $11,000+ in federal taxes.
Permanent Tax Rate Certainty
What Changed: The Tax Cuts and Jobs Act rates are now permanent. The 37% top rate stays at 37% (not reverting to 39.6%), and all the broader bracket ranges and expanded standard deduction remain in place with no sunset clauses.
Why This Matters: For the first time in years, you can build long-term tax strategies with confidence about future marginal tax rates.
Strategic Opportunities:
- Multi-Year Roth Conversions: Convert retirement account funds at today’s lower rates without worrying about rate increases in 2026.
- Charitable Giving Strategies: Plan long-term charitable giving with certainty about tax benefits.
- Trust Distribution Planning: Optimize trust distributions knowing the rate structure will remain stable.
Real-World Example: You could convert $200,000 per year from traditional retirement accounts to Roth accounts over the next five years, staying in the 24% bracket instead of potentially facing much higher rates later.
QSBS Benefits: A Game-Changer for Entrepreneurs
What Changed: Qualified Small Business Stock (QSBS) benefits have been dramatically enhanced:
- Partial exclusions now available: 50% after 3 years, 75% after 4 years, 100% after 5 years
- Lifetime exclusion cap increased from $10 million to $15 million per company
- Asset threshold for qualifying businesses raised from $50 million to $75 million
Why This Matters: If you invest in or own small businesses, you can now get tax benefits faster and at higher levels than ever before.
Strategic Opportunities:
- Review Current Holdings: Analyze your existing QSBS positions for new optimization opportunities.
- New Investment Strategies: Consider C-corporation structures that previously might not have been attractive.
- Succession Planning: Structure business sales to maximize QSBS benefits for multiple generations.
Real-World Example: If you’re a tech entrepreneur selling your company, under the old rules you had to hold stock for five years to get any exclusion, capped at $10 million. Now you can get partial exclusions starting at three years and exclude up to $15 million in gains.
QBI Deduction: Enhanced and Permanent
What Changed: The 20% Qualified Business Income (QBI) deduction for pass-through businesses is now permanent, with enhanced benefits:
- Income thresholds raised from $50,000/$100,000 to $75,000/$150,000
- New $400 minimum deduction for anyone with at least $1,000 of active business income
Why This Matters: If you own a pass-through business (S-corp, partnership, sole proprietorship), you can plan with certainty that this valuable deduction will continue.
Strategic Opportunities:
- Business Structure Optimization: Consider whether pass-through treatment remains optimal given the permanent nature of the deduction.
- Income Planning: Structure business income to maximize QBI benefits with the new higher thresholds.
- Multi-Entity Strategies: Use multiple business entities to optimize deduction benefits.
Real-World Example: If you run a consulting business that was previously phased out of the QBI deduction, the higher thresholds might restore your full 20% deduction, saving you thousands annually.
Additional Opportunities Worth Nothing
The One Big Beautiful Bill includes several other provisions creating planning opportunities:
Trump Accounts: New tax-advantaged savings accounts for children under 18, with up to $5,000 annual contributions and tax-free growth for qualifying purposes.
Tip and Overtime Deductions: Workers can deduct up to $25,000 in tip income and $12,500 in overtime pay through 2028.
Auto Loan Interest: Deduct up to $10,000 in interest on loans for American-made vehicles through 2028.
Charitable Giving Changes: A 0.5% AGI floor now applies before taking charitable deductions, but the cap on cash contributions increased to 60% of AGI.
Time-Sensitive Action Items
Several of these opportunities have expiration dates:
- SALT deduction benefits end after 2029
- Tip and overtime deductions sunset in 2028
- Auto loan interest deduction expires in 2028
This means you have a limited window to maximize these benefits.
Common Misconceptions to Avoid
I’ve already seen confusion about these changes that could cost people significant money:
- Myth: The estate tax exemption only applies to farms
- Reality: It applies to all estates, regardless of asset type
- Myth: The SALT deduction only benefits those making under $500,000
- Reality: The phase-out doesn’t eliminate the benefit entirely until much higher income levels
- Myth: These changes don’t affect me because I’m not “ultra-wealthy”
- Reality: Many provisions benefit middle and upper-middle-class families
What You Should Do Now
The families and business owners who act in the next 90 days will be best positioned to maximize these opportunities. Here’s your action plan:
Immediate Steps (Next 30 Days)
- Review Your Estate Plan: Determine if the increased exemptions change your gifting strategy
- Analyze Your SALT Situation: Calculate potential savings and consider accelerating payments
- Assess Business Structure: Evaluate if these changes affect your optimal entity structure
- Review Investment Holdings: Identify any current or potential QSBS opportunities
Strategic Planning (Next 90 Days)
- Roth Conversion Analysis: Model multi-year conversion strategies with permanent rate certainty
- Trust Structure Review: Consider if new trust strategies could multiply benefits
- Business Succession Planning: Integrate new opportunities into succession plans
- Tax Projection Modeling: Update long-term tax projections with new law provisions
Professional Guidance
These changes are complex and interconnected. A comprehensive review of your situation should consider:
- How multiple provisions interact with each other
- The timing of various strategies to maximize benefits
- The coordination between income tax, estate tax, and business planning
- State-specific implications of federal changes
The Bottom Line
The One Big Beautiful Bill represents the most significant tax planning opportunities we’ve seen in years. The legislation provides both immediate benefits and long-term planning advantages, but several opportunities are time-limited.
The key is understanding how these changes apply to your specific situation and taking action while the benefits are available. The families who move quickly and strategically will be the ones who maximize these unprecedented opportunities.
Don’t let confusion or delay cost you hundreds of thousands of dollars in potential tax savings. The best time to plan was yesterday, but the second-best time is right now.
This analysis is based on the One Big Beautiful Bill as signed into law on July 4, 2025. Tax law is complex and constantly changing. This information is for educational purposes and should not be considered specific tax or legal advice. Consult with qualified professionals about your specific situation.
Ready to explore how these changes affect your specific situation? Contact our office to schedule a comprehensive review of your tax and estate planning strategies in light of this new legislation.
