Planning Tips & Insights from the One Big Beautiful Bill Act Provisions

On July 4, 2025, President Trump signed into law the One Big Beautiful Bill Act (OBBBA), a reconciliation package that includes a broad array of tax provisions affecting individuals, businesses and international taxpayers.

We want to highlight some tax planning ideas for 2025 and the next few years. Please contact us at your earliest convenience to discuss your situation so we can develop a customized plan. We will continue to closely monitor any potential regulatory guidance as it’s developed from the IRS and update you accordingly.

Individual income tax (see provisions detailed at this post)

• Make Charitable Contributions: 

  • Contributions made in 2025 avoid limits on charitable contribution deductions that apply in 2026.

  • Front-load contributions in 2025 via a Donor Advised Fund or Private Foundation should be considered as an option to facilitate “bunching” deductions to park accelerated gifts.

  • Use appreciated stock instead of cash.

  • Make qualified charitable distributions from your IRA.

• Convert a Traditional IRA to a Roth IRA (if cashflows allow related tax liability):

  • Manage income tax bracket.

  • No RMDs during your lifetime.

  • Tax-free distributions.

• Make Gifts to Utilize Lifetime Exemption and Annual Exclusion: 

  • Amount of lifetime exemption could be reduced in the future.

  • Gifting appreciating property sooner rather than later removes more value from estate.

  • Annual exclusion gifts avoid gift tax and estate tax.

• Enhanced deduction for seniors: Consider opportunities to accelerate or delay income to meet deduction thresholds because the additional $6,000 senior deduction is phased out for taxpayers with income higher than $75,000 ($150,000 for joint filers).

• Transfer Vacation Home to an Irrevocable Trust: 

  • Separate $40,000 SALT cap (property tax, etc.)

  • Potentially remove property from estate.

  • Must avoid grantor trust status.

• Buy an SUV or a Jet (or a Car Wash or a Gas Station): 

  • Greater than 50% business use.

  • 100% bonus depreciation deduction.

  • Must comply with the passive loss rules.

• Harvest Capital Losses: 

  • Use losses to reduce capital gains.

  • Reinvest sale proceeds in a similar investment.

  • Must avoid the wash sale rule.

• Education planning: Provides a foundation for young adults' financial planning. Families may consider integrating these accounts into broader education or homeownership savings plans. When combined with existing flexibility, there are tremendous planning opportunities for grandparents and parents to make amulti-generational impact on their families.

  • Trump accounts will be IRAs under Sec. 408(a) (but not Roth IRAs) for the exclusive benefit of individuals under 18. Contributions can be made in calendar years before the beneficiary turns 18 and distributions can be made starting in the calendar year the beneficiary turns 18. Trump accounts will have to be designated as such when they are set up, and no contributions are allowed until 12 months after the date of enactment of the Act. Under the Act, Treasury can set up Trump accounts for individuals that it identifies as eligible and for which no Trump account has already been created.

  • 529 plan qualified expenses now expands to include more K-12 and homeschool expenses, and postsecondary credentialing expenses. In particular, law, CPA, nursing, real estate, EMT, CDL (to name a few) credentialling would also be allowed (including exam expenses).

  
  

Business tax (see provisions detailed at this post)

• Bonus depreciation: 100% expensing (bonus depreciation) for qualified property is restored for property placed in service after Jan. 19, 2025.

  • Acquisition AND placed-in-service dates must be established!

  • Repair analysis v. bonus depreciation

• R&E expenditures: Immediate deduction of domestic research or experimental expenses paid or incurred in 2025 is allowed.

  • Permits Eligible Small Businesses to elect to expense Domestic R&E Expenditures incurred in tax years beginning after December 31, 2021, by filing amended returns for 2022 – 2024.

  • All taxpayers (large or small) may elect to expense any unamortized Domestic IRC § 174 assets from tax years 2022 through 2024.

• No Tax on Tips or Overtime: Benefit to individual taxpayers, burden to the employers in terms of reporting.

  • All tax and overtime wage information will now be required to be reported on Form W-2, or equivalent.

• Charitable deduction for corporations: only contributions above 1% of taxable income are deductible, up to 10% limit.

  • Business owners who currently make charitable contributions through their corporation will have to reconsider the most taxadvantageous way to make those contributions under the new law

How can you prepare?

A phased approach to planning will align with the timing and impact of this legislative development. This approach allows us to support you with timely strategies tailored to each stage of implementation:

• Short-term planning will focus on immediate actions and compliance considerations for tax provisions already in effect or taking effect soon.

• Mid-term planning will address transitional provisions and opportunities that emerge over the next 12–18 months.

• Long-term planning will help position you for sustained success by anticipating future changes and aligning your financial goals with the broader tax policy environment.

We’re here to help

We’ll continue to monitor developments closely and provide updates and guidance as new details become available. Our goal is to ensure you’re informed, prepared, and supported — every step of the way.

Our team is available to discuss the provisions and related planning accordingly.

Please don’t hesitate to contact us with any questions or to schedule a consultation.