One Big Beautiful Bill Act

Below is a summary of individual and business provisions. Many of the clean energy credits have been rolled back and phased out over the next year. Additional guidance is expected on some of these new provisions so the information is subject to change. For full details: https://www.irs.gov/pub/irs-drop/rp-24-40.pdf

Individual Provisions

General Description	OBBBA Summary	Effective Date
Individual Income Tax Rates	Retained existing seven brackets: 10%, 12%, 22%, 24%, 32%, 35% and 37% Income thresholds indexed for inflation Brackets under 24% receive additional year inflation adjustment	Taxable Years Beginning After Dec. 31, 2025
Alternative Minimum Tax	Permanently allowed 2018 individual AMT exemption amounts indexed for inflation Increased phaseout percentage from 25% to 50% Modified phaseout thresholds to $500,000 (single) or $1,000,000 (joint) with an index for inflation	Taxable Years Beginning After Dec. 31, 2025
Standard Deduction	Permanently allowed $31,500 (married filing jointly), $23,625 (head of household), and $15,750 (single) plus future inflation adjustments	Taxable Years Beginning After Dec. 31, 2024
Temporary Senior Deduction	Added new $6,000 above-the-line deduction for individuals at least 65 Phases out for married taxpayers with incomes of $150,000 (joint return) or $75,000 (others)	Taxable Years Beginning After Dec. 31, 2024 through tax years beginning before Jan. 1, 2029
Itemized Deduction Limitation	Caps benefit of each dollar by $0.35 for taxpayers in the top tax bracket (37%)	Taxable Years Beginning After Dec. 31, 2025
Miscellaneous Itemized Expense Deductions	No longer allowed (other than certain educator expenses which has been removed from the list of miscellaneous itemized deductions)	Taxable Years Beginning After Dec. 31, 2025
Mortgage Interest Deduction	Permanently retained principal limit of $750,000 and disallowance of deduction for home equity interest	Taxable Years Beginning After Dec. 31, 2025
Car Loan Interest	Temporarily allowed a deduction of up to $10,000 per taxable year for certain car loan interest for Taxable Years Beginning After Dec. 31, 2024 and before Dec. 31, 2029 Phase-out of deduction for incomes over $100,000 (non-joint return) and $200,000 (joint return)	Indebtedness incurred after Dec. 31, 2024
SALT Cap	Temporarily raised SALT deduction cap from $10,000 to $40,000 per taxable year through 2029, with phased out deduction amount for individuals earning more than $500,000 per year ($250,000 per year for married filing separately) The change did not eliminate the availability of state-level pass-through entity (PTE) tax regimes	Taxable Years Beginning After Dec. 31, 2024
Wagering Losses	Permanent modification to limit wagering loss deductions to 90% of the amount of wagering losses for the taxable year with an overall limitation equal to the amount of wagering gains during the same taxable year	Taxable Years Beginning After Dec. 31, 2025
Casualty Losses	Permanently allowed personal casualty losses from both federal and state declared disaster areas and offset with personal casualty gains	Taxable Years Beginning After Dec. 31, 2025
Individual Charitable Deductions	Created permanent deduction for individuals that do not itemize to claim up to $1,000 (single) or $2,000 (married filing jointly) For itemized deductions, a charitable contribution deduction is allowed only in excess of 0.5% of the taxpayer’s contribution base for the taxable year, with some possibility of a carry forward of unutilized deductions	Taxable Years Beginning After Dec. 31, 2025
Qualified Business Income Deduction	Permanently allowed deduction for qualified business income from a pass-through entity at 20% Expanded deduction limit phase-in by increasing the $50,000 (non-joint returns) and $100,000 (joint returns) amounts to $75,000 and $150,000, respectively Added minimum $400 deduction for taxpayers having at least $1,000 of qualified business income from one or more active qualifying trades or businesses	Taxable Years Beginning After Dec. 31, 2025
Moving Expense Deduction	Permanently eliminated moving expense deduction for all taxpayers expect for active duty members of the armed forces and intelligence community	Taxable Years Beginning After Dec. 31, 2025
Tip Taxation	Temporarily provided a deduction of up to $25,000 per taxable year for qualified tips Phases out for incomes over $150,000 (non-joint return) and $300,000 (joint return) Deduction disallowed for any taxable years beginning after Dec. 31, 2028	Taxable Years Beginning After Dec. 31, 2024
Overtime Taxation	Temporarily provided a deduction of up to $12,500 (non-joint return) and $25,000 (joint return) per taxable year for qualified overtime compensation which is the amount OVER normal compensation ("1/2 pay" portion of "time and 1/2") Phases out for incomes over $150,000 (non-joint return) and $300,000 (joint return) Deduction disallowed for any taxable years beginning after Dec. 31, 2028	Taxable Years Beginning After Dec. 31, 2024
529 Accounts	Expanded types of qualifying expenses to include certain elementary or secondary public, private or religious school expenses Permanently allowed money in 529 accounts to be rolled over to an ABLE account without penalty	Taxable Years Beginning After Dec. 31, 2025
Trump Accounts	Created tax-exempt savings accounts for certain minors allowing up to $5,000, subject to an annual cost of living adjustment increase, may be contributed each calendar year Employers may contribute without an employee income inclusion up to $2,500 per employee into a Trump Account for the employee or any dependent of the employee A one-time $1,000 credit will be available for each qualifying child born after Dec. 31, 2024 and before Jan 1, 2029	Contributions not accepted before July 4, 2026
Qualified Small Business Stock	Permanently increased corporation maximum aggregate gross asset limitation from $50,000,000 to $75,000,000, and increased the applicable dollar limit amount for gain exclusion from $10,000,000 to $15,000,000, and added an inflation adjustment to each Added phase-in of the applicable percentage of gain exclusion depending upon holding period of stock: (1) at least 3 years – 50%, (2) at least 4 years – 75%, and (3) at least 5 years – 100%	Changes generally apply to qualified small business stock acquired after July 4, 2025
Remittance Transfers	Added a 1% excise tax on certain remittance transfers from the United States to an international jurisdiction If the excise tax is not paid by the sender, the provider may have secondary liability for the tax amount There are some exceptions to the transactions subject to this excise tax	Transfers made after Dec. 31, 2025

Business Tax Provisions

General Description	OBBBA Summary	Effective Date
Excessive Employee Remuneration	Added a controlled group/entity aggregation rule applicable for determining applicable individuals for the Section 162(m) limitation	Taxable Years Beginning After Dec. 31, 2025
Business Interest Expense Limitation	(1) Permanently reinstated EBITDA for calculating Adjusted Taxable Income (2) Modified floor plan financing coverage to include trailers and campers (3) Modified coordination rules with interest capitalization provisions	Generally, Taxable Years Beginning After Dec. 31, 2024, except (3) is effective for Taxable Years Beginning After Dec. 31, 2025
Full Expensing of Qualified Production Property	Temporarily allowed an elective 100% depreciation deduction for newly built qualified production property the construction of which began after Jan. 19, 2025 and before Jan. 1, 2029, and which is placed in service before Jan 1, 2031	Property placed in service after July 4, 2025
Full Expensing of Certain Business Property	Permanently allowed 100% bonus expense deduction for certain business property	Varies, but can apply to some property acquired after Jan. 19, 2025
Corporate Charitable Deductions	Allowed deduction for aggregate charitable contributions in excess of 1% of taxable income up to a maximum of 10% of taxable income Carry forwards of some unutilized deduction amounts in excess of this 10% threshold may be available for up to 5 years	Taxable Years Beginning After Dec. 31, 2025
R&D Expenditures	Permanently allowed immediate deduction of domestic R&D expenditures paid or incurred in taxable years beginning after Dec. 31, 2024 Certain small taxpayers can elect to apply change to taxable years beginning after Dec. 31, 2021 Foreign R&D expenditures must continue 15 year capitalization Taxpayers that made domestic R&D expenditures after Dec. 31, 2021 and before Jan. 1, 2025 are permitted to elect to accelerate these R&D deductions over a 1- or 2-year period	July 4, 2025, but see timing rules in preceding summary
Expensing Certain Depreciable Assets	Permanently allowed immediate expensing of the cost of qualifying property up to $2,500,000, with a phaseout threshold that begins to reduce deduction amount when costs exceed $4,000,000	Property placed in service in Taxable Years Beginning After Dec. 31, 2024
Energy Efficient Commercial Buildings Deduction	Permanently terminated provision	Construction of property which begins after June 30, 2026
Expensing of Certain Qualified Sound Recording Productions	Expands expensing rules to allow a deduction of up to $150,000 per taxable year for sound recordings produced and recorded in the US and also qualifies certain sound recordings for bonus depreciation	Taxable Years Beginning After July 4, 2025
Business Meal Deductions	Permanently disallowed deductions for employer-provided meals with limited exceptions	Amounts paid or incurred after Dec. 31, 2025
Excess Business Losses	(1) Permanent modification and extension of the limitation on excess business losses for noncorporate taxpayers (2) Allowed continued inflation adjustments	(1) Taxable Years Beginning After Dec. 31, 2026 (2) Taxable Years Beginning After Dec. 31, 2025
Partnership Disguised Sales	Modified disguised sale rule to confirm that the proper tax treatment with respect to payments from a partnership to a partner for services performed or property transferred is not dependent upon the issuance of Treasury Regulations Provision indicated that the law change shall not be construed as creating any inference for periods prior to July 4, 2025	July 4, 2025
Taxable REIT Subsidiaries	Permanently modified the 75% asset value test to increase permitted ownership of taxable REIT subsidiary stock from 20% to 25%	Taxable Years Beginning After Dec. 31, 2025
Opportunity Zones	Permanently includes the opportunity zone program in the Internal Revenue Code Established rolling 10-year periods to determine qualified opportunity zones and narrowed the eligibility requirements Modified taxpayer basis adjustment benefit for investments held at least 10 years to cap basis step-up to fair market value on the 30-year anniversary date Additional program adjustments made	July 4, 2025
Information Reporting	Replaced $600 minimum for certain information reporting with $2,000 minimum and included an inflation adjustment provision	Payments made after Dec. 31, 2025
Information Reporting – Form 1099-K	(1) Reverted to previous de minimis reporting exception for third party settlement organizations so no reporting required with respect to a payee unless the gross amount of the payee’s transactions exceeds $20,000 and the aggregate number of such transactions exceeds 200 (2) Added new backup withholding provision applicable to reportable payments meeting certain thresholds	(1) Retroactively as if included in Section 99674 of American Rescue Plan Act (i.e., for returns for calendar years beginning after Dec. 31, 2021) (2) Calendar years beginning after Dec. 31, 2024

This information is intended for informational purposes only and does not constitute tax, legal, investment, accounting, or other professional advice.