The One Big Beautiful Bill (OBBB), signed into law on July 4, 2025, is one of the most sweeping tax reforms in years. While it touches households across the income spectrum, its most meaningful changes impact high-net-worth individuals and families. From income tax stability to estate planning opportunities, the bill creates both advantages and planning opportunities.

Tax Rates Locked In

The OBBB locks in the current seven-bracket system: 10%, 12%, 22%, 24%, 32%, 35% and 37%. Prior to this law, those brackets were set to sunset in 2025, which would have meant higher rates across the board.

For high earners, the permanence of today’s rates removes a layer of uncertainty. That makes it easier to time things like Roth conversions, trust distributions, and large income events.

Bigger Standard Deduction

The bill makes permanent the larger standard deduction established under the Tax Cuts and Jobs Act (TCJA): $31,500 for married couples and $15,750 for single filers in 2025.

In addition, individuals who are age 65 or older can claim an additional deduction of $6,000 on top of the standard deduction.

For high-net-worth taxpayers, this raises the bar for when deductions like mortgage interest, state taxes, and charitable gifts provide an incremental benefit — making bunching strategies more relevant.

Estate & Gift Breaks

The exemption for estate and gift tax climbs to $15 million per person and $30 million per couple in 2026, indexed for inflation.

This permanently changes the estate planning conversation, giving families more room to transfer wealth without being forced into rushed strategies.

SALT Relief — With Limits

The state and local tax (SALT) deduction cap rises from $10,000 to $40,000 through 2029.

But once income exceeds $500,000, the deduction begins phasing down, never falling below $10,000. Managing income levels will matter for those hoping to maximize the benefit.

AMT Exemption Permanent

The Alternative Minimum Tax (AMT) exemption from the TCJA has been permanently extended up to $88,100 for single filers and $137,00 for joint filers in 2025. However, the exemption phaseout threshold will be reduced to $500,000 for individuals and $1,000,000 for couples and phase-out rate increases from 25% to 50%.

Giving Gets Trickier

Charitable contributions remain deductible, but starting in 2026, itemizers face a 0.5% AGI floor and the top tax benefit for deductions drops from 37% to 35%.

This will push many donors to rethink timing and structure, with donor-advised funds and qualified charitable distributions becoming more valuable.

529s Open Up

Families can now use up to $20,000 per year from 529 plans for K–12 tuition. The list of qualified expenses also expands to cover tutoring, test prep, dual-enrollment, licensing exams, and credentialing programs.

Business Wins

• QBI Deduction: The 20% pass-through deduction is permanent.
• QSBS: Exclusion rises to $15 million, with bigger breaks for longer holding periods.
• Expensing: 100% bonus depreciation returns; Section 179 cap set at $2.5 million.

These provisions tilt heavily toward business owners and investors looking to reinvest or transition efficiently.

Takeaways

The Big Beautiful Bill locks in rates, boosts estate exemptions, and expands business incentives. At the same time, the larger standard deduction, SALT, AMT, charitable giving rules, and 529 changes require fresh planning. While many provisions are labeled “permanent,” tax laws rarely are.

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