Big Tax Changes Are Coming – Here’s What You Need to Know

Author

Vince Porter
July 16, 2025

Table of Contents

The FY2025 Reconciliation Bill—originally dubbed the One Big Beautiful Bill—is now law. That earlier name may not have made it into the final title, but it definitely caught on. And let’s be honest, it’s what most of us will call it going forward. A little trivia for future tax dorks like me.

This bill locks in long-term tax changes for business owners, real estate investors, and middle-class taxpayers. There’s a lot packed into it, and if you plan smartly, it opens up meaningful opportunities.

Join us on Monday, July 21st at 2:00 PM CST as we walk through the details of this bill, how it may impact you, and the planning opportunities it opens up.
Register here to attend:
https://us06web.zoom.us/webinar/register/7017519167347/WN_FPYgahQhSA6DZKyI6JVztA

Here’s a quick breakdown of what’s in the bill—and why it matters to you:

Individual Tax Updates

  • The Trump-era tax cuts are now permanent. That means the lower tax brackets and larger standard deduction amounts will continue without expiring.

  • The Child Tax Credit increases to $2,200 and will adjust with inflation going forward.

  • The SALT deduction cap increases to $40,000 in 2025 and then gradually phases back to $10,000 by 2030. There’s also an income-based phaseout starting at $500,000 of adjusted gross income.

  • New above-the-line deductions were added:

    • Up to $25,000 for reported tip income

    • Up to $12,500 for qualified overtime pay

    • Up to $10,000 in interest on a personal-use vehicle loan (available 2025 through 2028)

  • A new tax-deferred savings account for minors called a “Trump Account” is available beginning in 2025. You can contribute up to $5,000 per year, and eligible children born between 2025–2028 may receive a $1,000 federal seed deposit.

  • The Excess Business Loss (EBL) limitation is now permanent. This restricts the amount of pass-through business losses that can offset other income (like wages or investment income). For 2024, the cap is $610,000 for joint filers and $305,000 for single filers. Losses above that are converted into net operating losses and carried forward. This rule hits real estate investors and entrepreneurs particularly hard, so careful planning is critical.

Business Tax Updates

  • The 20% Qualified Business Income (QBI) deduction is now permanent. Phase-out thresholds have increased, and there’s a $400 minimum deduction for small business owners who qualify.

  • 100% bonus depreciation is back for good, applying to qualifying equipment, machinery, and certain building improvements.

  • A new provision allows for 100% first-year depreciation on nonresidential real estate used in manufacturing or production. This is a big deal for businesses constructing or renovating manufacturing facilities or industrial real estate before 2031.

  • Section 179 expensing limits were raised to $2.5 million, with a phase-out threshold starting at $4 million. These will adjust annually for inflation.

  • Section 163(j) interest deduction rules were improved. You can now calculate adjusted taxable income (ATI) before depreciation and amortization, which boosts how much interest you can deduct—especially helpful for leveraged businesses and real estate projects.

  • There's also a new deduction for up to $150,000 of U.S.-based music production costs, and bonus depreciation applies to those expenses as well.

Estate and Gift Tax Updates

  • The estate and gift tax exemption is permanently increased to $15 million per person, indexed for inflation. This provides clarity and removes the urgency of planning around a pending sunset, but for families with large estates or closely held businesses, strategic gifting is still a valuable planning tool.

We'll be covering all of this in our upcoming monthly webinar series, Office Hours, on Monday, July 21st at 2:00 PM Central. We'll break down the planning opportunities this bill creates and share what you should be thinking about right now.

We hope you’ll join us for a straightforward breakdown and some practical guidance.

There’s a lot to work with here—and a lot to plan for, you need to know about these changes !