OBBBA & Your Taxes: Permanent Changes & Temporary Breaks
September 8, 2025
The recently passed One Big Beautiful Bill Act (OBBBA) introduced more than 90 new tax provisions—some that are permanent, others that expire in just a few years. This mix of long-term certainty and short-term opportunities means thoughtful planning is more important than ever.
Here’s a breakdown of the most important updates, what they mean for you, and strategies to consider as you plan ahead.
Permanent Provisions: A New Baseline for Planning
Several key changes under the OBBBA are here to stay, creating a more stable tax environment for both individuals and businesses:
Individual Tax Rates & Brackets
● Tax brackets introduced by the TCJA are now permanent, with the top rate holding at 37%. The standard deduction has increased to $15,750 for single filers and $31,500 for joint filers, with annual inflation adjustments built in.
Charitable Deductions
● Beginning in 2026, non-itemizers can take a new $1,000 ($2,000 joint) charitable deduction. At the same time, a new 0.5% AGI floor will apply to itemized donations, and high earners will see charitable deduction benefits capped at 35%.
Child Tax Credit
● Permanently raised to $2,200 in 2025 and indexed for inflation beginning in 2026.
Estate & Gift Taxes
● Starting in 2026, the lifetime exemption rises to $15 million per individual ($30 million per couple), adjusted annually for inflation.
Business Provisions
● Section 199A 20% Qualified Business Income deduction is permanent.
● Bonus depreciation returns to 100% for short-lived assets.
● Section 179 expensing rises to $1.5 million, with a higher phaseout threshold.
● Business interest deduction is now permanently based on EBITDA.
Planning takeaway: Permanent provisions create a reliable baseline for long-term strategies. For example, the higher estate exemption allows wealthy families to plan gifts or transfers with more certainty, while business owners benefit from restored deductions and expensing rules.
Temporary Opportunities: “Use It or Lose It”
Not all tax breaks will last. Several provisions are designed to sunset after 2028:
● Senior Bonus Deduction (2025–2028): An extra $6,000 per person ($12,000 per couple) for taxpayers over 65, on top of the standard deduction.
● Tip & Overtime Deductions: Workers can deduct up to $25,000 in tips and $12,500 in overtime pay ($25,000 for joint filers). These deductions phase out at higher income levels.
● Auto Loan Interest Deduction: Up to $10,000 per year on loans for U.S.-assembled vehicles (phases out at higher incomes).
● SALT Deduction Cap Expansion: The cap increases from $10,000 to $40,000 starting in 2025, with gradual increases until 2029 before reverting to $10,000.
● Clean Energy Incentives: Credits for EVs, charging stations, and home energy upgrades expire between 2025 and 2026.
Planning takeaway: Timing matters. If you qualify for these deductions or credits, acting before the deadlines can help maximize your savings.
Provisions with Mixed Timelines
Some changes fall in between permanent and temporary:
● Trump Accounts: A new savings vehicle with a $1,000 government-funded deposit for children born between 2025 and 2028. The accounts themselves grow tax-deferred indefinitely, but the program is limited to a short enrollment window.
● Full Expensing for Long-Lived Property: Available only until January 1, 2031, creating a planning opportunity for capital-intensive businesses.
Key Planning Strategies
To make the most of the OBBBA:
● Act fast on temporary credits and deductions like clean energy incentives, auto loan interest, or senior bonus deductions.
● Revisit charitable giving strategies to account for new AGI floors and deduction caps. Donor-advised funds may help you bunch contributions effectively.
● Be mindful of income thresholds and phaseouts, especially around the SALT cap, where small income shifts could eliminate a deduction.
● Review estate plans now that the $15 million exemption per person is locked in. Consider updating trusts, gifting strategies, and succession plans.
● Build flexibility into your long-term plan. Even permanent provisions could change under future legislation.
The Bottom Line
The OBBBA delivers both stability and complexity. Some provisions provide a permanent foundation for planning, while others require quick action before they expire. By understanding the timing of each change, you can take advantage of today’s opportunities while positioning your finances for the future.
If you’d like to discuss how these changes may affect your personal or business situation, we’re here to help you build a plan that balances immediate benefits with long-term strategy.
Sources:
https://www.horsesmouth.com/the-obbbas-permanent-vs-temporary-tax-changes-a-cheat-sheet
Taylor, Debra. “The OBBBA’s Permanent vs. Temporary Tax Changes: A Cheat Sheet.” 8 Sept. 2025, www.horsesmouth.com/the-obbbas-permanent-vs-temporary-tax-changes-a-cheat-sheet. Accessed 8, Sept 2025.
Disclosure:
This information is an overview and should not be considered as specific guidance or recommendations for any individual or business.
This material is provided as a courtesy and for educational purposes only.
These are the views of the author, not the named Representative or Advisory Services Network, LLC, and should not be construed as investment advice. Neither the named Representative nor Advisory Services Network, LLC gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. Please consult your Financial Advisor for further information.