New Legislation Includes Big Beautiful Tax Benefits

By Andrew Comstock, CFA®

Earlier this month, the One Big Beautiful Bill Act (OBBBA) was signed into law by the president. This new legislation included sweeping changes to the tax code; many expiring provisions were made permanent, others expanded, and some new ideas were implemented.

At Beyond Wealth, we understand the effect taxes can have on building and preserving your wealth. This is why we emphasize tax efficiency in our recommendations and planning strategies for our clients. In this article, we summarized the important changes you should be aware of and consider how they may apply to your own tax situation.

TCJA Provisions and Deductions Made Permanent

A great deal of the tax legislation extended provisions of the Tax Cut and Jobs Act (TCJA) of 2017 that were due to sunset starting in 2026.

• The OBBBA retains current tax brackets (topping out at 37%) with certain inflation adjustments.
• The Act extends the TCJA standard deduction with an increase to $15,750 for single filers, $23,625 for head of household, and $31,500 for MFJ taxpayers, inflation-adjusted after 2025.
• The SALT deduction for state and local taxes is increased from $10,000 to $40,000 until 2030 for those with an adjusted gross income (AGI) under $500,000.
• The “senior deduction” was increased by $6,000 for those 65 and over, with an AGI of less than $75,000 single/$150,000 married. Phaseouts occur above these income levels. This increase is in addition to the current senior deduction of $2,000 (single) and $1,600 (MFJ) and expires after 2028.
• The Child Tax Credit is now permanent, and the maximum was increased from $2,000 to $2,200 starting in 2025). These will be indexed to inflation starting next year. In addition, the Adoption Tax Credit was upgraded to a $17,280 maximum for 2025 and a $5,000 refundable credit, indexed to inflation. Phase-outs begin at MAGI levels above $259,190.

Action Steps to Take

Review your 2024 return and determine whether these deductions and credit changes may apply to you. Summer may be a good time to consult with your tax professional (or us!) as to how you might adjust your payroll withholding, your financial plan, or your tax situation to take advantage of these opportunities.

Other Tax Law Changes

The OBBBA also altered other tax laws that could affect your future finances and planning.

• The legislation made the expiring federal estate tax exemptions permanent and increased the limits to $15 million and $30 million for single/MFJ taxpayers, respectively, indexed for inflation. This would also apply to the generation-skipping transfer tax.
• The law also made “portability” of the exemptions permanent. The top estate and gift tax rate remains at 40%.
• Charitable giving rules were changed significantly for tax years after 2025.
  1. Individuals who itemize deductions will only be able to deduct charitable contributions that exceed 0.5% of their adjusted gross income (AGI).
  2. The 60% AGI limit for cash gifts to public charities is now permanent. Donors may combine cash and noncash gifts to reach the 60% limit.
  3. Non-itemizers will now be able to deduct up to $1,000 individually (or $2,000 if MFJ) for cash gifts to 501(c)(3) public charities. This deduction excludes contributions to supporting organizations, donor-advised funds, and private foundations.
• Higher-income taxpayers may enjoy the now-permanent higher alternative minimum tax (AMT) thresholds taking effect in 2026. The exemption phaseout accelerates for income above $500,000 for single filers and $1 million for MFJ.
• New car loan interest may be deductible up to $10,000 from 2025-2028. Eligible vehicles must have had the final assembly completed in the USA, and this deduction starts to phase out after $200,000 of income for couples and $100,000 for single tax filers.
• 529 qualified expenses have been expanded. The biggest change comes to K-12 education. The maximum distribution for K-12 education has increased to $20,000 from $10,000 starting in 2026. In addition, you can now use 529s for tutoring, SAT/ACT classes, and physical, occupational, behavioral, speech-language, and other therapies for students with disabilities.
• From now until the end of 2028, newborns will receive a $1,000 deposit from the federal government into a new “Trump Account.” These will be tax-deferred, index fund accounts where further contributions of up to $5,000 per year may be made. The final details on this new account type are still being sorted out.

Action Steps to Take

Now that the estate tax exemptions under TCJA will not sunset, reviewing your estate and legacy planning with us and/or your estate planning attorney would be a smart move. Our tax planning software is updated with the new tax law changes, and we are happy to review how these laws will impact you this year and beyond.

Business Owners May Benefit As Well

The legislation also included many beneficial changes for business owners. Among them:

• For certain business owners, starting in 2026, the 20% qualified business income (QBI) deduction will become permanent. The QBI is essentially for sole proprietorships, partnerships, and S-corps and is subject to income limitations. 
• Business owners considering equipment or property purchases are eligible for a 100% bonus depreciation, meaning you can deduct the cost when it occurs, rather than over five years. Consider the benefits of large expenditures before this law sunsets in 2029. 
• For Qualified Small Business Stock (QSBS) acquired after July 4, 2025, owners of the stock can exclude 50% of gains if they hold the stock for at least three years, 75% for four years, and 100% of the gain if held for five or more years. 
• The threshold for defining a Qualifying Small Business (QSB) is now $75 million, up from $50 million. Now more small and growing businesses can attract investors to their company with the help of lucrative QSBS. 
• High-growth industries, including life sciences and technology, can now expense their research and development (R&D) costs in the year they occurred.

Actions for Business Owners to Take

Your business CPA may have more time during the summer for a tax review. Schedule one to discuss potential tax savings and strategies that take advantage of these changes so you might plan ahead for the coming year.

Not Sure How This Legislation Will Affect Your Finances and Taxes? Let’s Have a Discussion.

At Beyond Wealth, we focus on the most efficient tax and planning strategies to help you realize your objectives and life aspirations. Our independent advisory firm offers an array of services—focused on our clients—to help pursue a confident financial future. 

Our goal is aligned with yours: Connect your wealth to your life’s objectives and empower you to choose and follow the financial road that feels right for you and your family.

Are you entering your 40s, building wealth, and ready to take charge of your financial future? Give us a call (913) 871-7980 or email andrew@beyond-wealth.com to schedule an introductory meeting and start this year on a better financial path toward your own vision.

About Andrew

Andrew Comstock, CFA®, is Principal & Wealth Advisor at Beyond Wealth, a fiduciary financial advisory firm in Overland Park, Kansas, dedicated to empowering clients to make impactful financial decisions. Serving the Kansas City metro area, Beyond Wealth specializes in helping wealth-building professionals and business owners navigate life transitions. With a mission to provide comprehensive wealth management services, Andrew’s proficiency lies in leveraging his background in institutional investment management to create tailored investment strategies. He provides research-driven portfolio management, focusing on helping clients build wealth for key milestones, whether it’s buying their forever home, purchasing a business, or funding their children’s education. Alongside Brandy, Andrew combines comprehensive planning with a long-term investment approach, helping clients grow their wealth while enjoying life.

Andrew began his career in institutional investment management, managing portfolios for insurance companies, pension funds, and mutual funds. Inspired by a desire to make a more personal impact, he transitioned to advising individuals directly, bringing his passion for financial empowerment to Beyond Wealth. Known for his commitment to high standards and always seeking to grow and discover, Andrew is dedicated to delivering thoughtful, tailored strategies for his clients’ unique financial needs.

Andrew graduated from the University of Tulsa with a BSBA in Finance and obtained the Chartered Financial Analyst® designation. Active within his professional community, he’s a member of the CFA Institute, Kansas City CFA Society, and the Overland Park Rotary Club.  Andrew is a past president of his Rotary club, served on the University of Tulsa’s Board of Trustees, and was the National Board President of the Alumni Association at TU. He is the Investment Chair for the Catholic Foundation of Northeast Kansas. Outside of work, Andrew is a devoted Chiefs, Royals, Sporting KC, and Everton fan who loves exploring KC’s vibrant restaurant scene, especially the BBQ hotspots. With dual citizenship in the U.S. and Ireland and experience living in Switzerland, he’s an avid traveler who’s visited 37 countries and counting. Andrew is also a proud cancer survivor, a perspective that reinforces his commitment to helping families feel confident about their financial futures while embracing the present. To learn more about Andrew, connect with him on LinkedIn.