The One Big Beautiful Bill Act: Key Tax Changes for Advisors

Author

Dave Alison, CFP®, EA, BPC
Bio

Key Takeaways

The One Big Beautiful Bill (OBBB) Act brings big changes:

Makes Section 199A/QBI permanent
Raises the SALT cap to $40,000 through 2029
Lifts estate exemption to around $15 million/$30 million in 2026
Creates Trump Accounts
Introduces new senior deductions

Financial advisors have immediate planning opportunities for Roth conversions, charitable bunching and family wealth strategies.

Let’s explore what the OBBB Act means for you as a financial advisor and for your clients. We’ll also uncover how its tax changes reshape long-term planning.

What the OBBB Act Means for Financial Advisors

If your clients haven’t asked you about the One Big Beautiful Bill Act yet, they will. And when they do, you want to be the advisor who does more than understand the changes. You want to immediately show them how to benefit from it..

The president signed the OBBB Act, also known as Trump’s Big Beautiful Bill, into law on July 4, 2025. It represents the most significant tax legislation since the Tax Cuts and Jobs Act.

Unlike most tax changes that give us months to prepare, these provisions took effect immediately. This sudden shift created both opportunities and traps for advisors who aren’t prepared.

Here’s your chance to differentiate yourself from the competition. While other advisors are still reading summaries, you can be implementing strategies that save clients thousands annually. Meanwhile, you position yourself as the proactive tax-smart advisor they need.

What Tax Cuts Are in the One Big Beautiful Bill?

The One Big Beautiful Bill Act lays the foundation for permanent tax certainty.

Let’s start with the headline everyone’s talking about. The OBBB makes the Tax Cuts and Jobs Act provisions permanent. No more sunset clauses, no more uncertainty about 2026. For advisors, this changes everything about our long-term planning.

Consider what “permanent” really means for your clients. We’re now operating with tax brackets that are dramatically lower than historical norms.

A married couple can earn up to $128,450 in gross income ($96,950 taxable income limit + $31,500 OBBB-enhanced standard deduction) and stay in just the 12% bracket. In 1980, that same inflation-adjusted income would have faced rates of 24-32%.

This represents annual tax savings of $10,000-15,000 for typical middle-income families compared to historical rates.

With permanent low rates, the focus has shifted from rushing income to timing it strategically.

What Does the Big Beautiful Bill Mean for SALT Deductions? The $500k Planning Cliff

The OBBB creates an extreme tax cliff between $500,000 and $600,000 modified adjusted gross income (MAGI). For taxpayers under $500,000 MAGI, the SALT cap increases to $40,000 through 2029. But here’s the critical part: it phases out by 30% of income over $500,000.

This steep phase-out represents a significant opportunity for proactive SALT planning for high-income clients.

Think about it this way: a client increasing their MAGI from $500k to $600k doesn’t just face higher ordinary rates. They lose $30,000 in SALT deductions, creating an effective marginal rate of 45.5%.

For your high-income clients in states like California or New York, this creates massive planning opportunities around income timing and entity structure.

New Charitable Giving Rules: Planning Around the 0.5% Floor

Starting in 2026, itemizers can only deduct charitable contributions exceeding 0.5% of their AGI. For a client with $1 million AGI, the first $5,000 in charitable giving generates zero tax benefit.

These new itemized deduction limits change how clients approach annual giving.

The strategic response? Consider bunching.

Instead of recommending clients give $5,000 annually, suggest they give $25,000 every five years. Then you can use donor-advised funds to smooth out actual charitable distributions while helping maximize their tax deduction.

For clients already giving significantly, this creates opportunities for multi-year funding strategies that overcome the floor limitation.

Senior Deductions and 0% Capital Gains: The Temporary Advantage

Don’t miss this provision: Taxpayers age 65 and older get an additional $6,000 deduction through 2028. Combined with the enhanced standard deduction, a married couple both over 65 can claim $46,700 in total deductions.

This creates a perfect set of variables for 0% capital gains harvesting.

These clients can realize up to $79,400 in capital gains at 0% federal tax. That’s $11,910 in annual tax savings at current capital gains rates.

Trump Accounts and Enhanced Family Planning Tools

The OBBB introduces “Trump Accounts,” a new savings vehicle created under the act.

Think of these as traditional IRAs for children with no earned income requirement. Parents can contribute $5,000 annually, and children born in 2025-2028 receive $1,000 in federal seed money.

While the tax treatment isn’t as favorable as 529 plans for education, it provides flexibility for many more purposes after age 18, such as a first home or a car. This offers a complementary savings vehicle for clients concerned about overfunding 529s.

Additionally, the OBBB Act creates more layers for comprehensive family planning:

Enhanced Child Tax Credit ($2,200 per child with $1,700 refundable)
Increased estate exemptions ($15 million per person)

You can wrap these changes into a coordinated family wealth planning stack. Align Trump Accounts, the enhanced Child Tax Credit and higher estate exemptions with your clients’ goals.

Qualified Business Income Deduction (QBI) Section 199A Made Permanent: What Business Owners Need to Know

Section 199A is now permanent with enhanced thresholds; the phase-out ranges increased by $75,000 (single)/$150,000 (joint). This means more taxpayers can ignore wage and property limitations.

This permanent change solidifies one of the most valuable tax provisions for small business owners.

But here’s what’s critical for specified service trade or business (SSTB) owners facing complete phase-outs. With permanent certainty, entity structure decisions become more strategic.

The accumulated earnings tax risk makes converting to a C corp often inadvisable for many service businesses. That’s despite the superficial appeal of the 21% rate.

Estate Tax Changes and Strategic Timing for High-Net-Worth Families

The $15 million exemption ($30 million for couples) creates interesting trade-offs. With permanent high exemptions, the urgency for large lifetime gifts has diminished, especially considering the loss of basis step-up.

For high-net-worth clients, these shifts redefine how and when to transfer wealth across generations.

The key insight? Lifetime transfers now require careful analysis weighing estate tax savings against lost income tax benefits from basis step-up. For many assets, the math favors waiting for the step-up unless you’re confident about significant future appreciation.

The Roth Conversion Sweet Spot with Permanent Low Tax Rates

With permanent low brackets and enhanced deductions for seniors, we’re in a Roth conversion golden age.

The combination of three factors creates compelling reasons to accelerate traditional IRA conversions:

Historically low tax rates (now permanent)
Wide bracket spreads (12% bracket extends to nearly $97k for couples)
The SECURE Act’s compressed distribution timeline.

Consider this scenario: a 60-year-old couple can convert $68,450 annually at just 12%. In turn, they potentially save their heirs from 37% or higher tax rates on inherited IRAs.

Critical Energy Tax Credit Deadlines You Can’t Miss

Several energy-related credits created or extended under the OBBB are set to expire soon. Valuable tax credits are phasing out on specific dates.

If any apply to you, mark your calendar and take action to help maximize your clients’ tax benefits before these opportunities disappear.

September 30, 2025: All clean vehicle credits expire:
- 25E (Previously owned vehicles)
- 30D (New clean vehicles)
- 45W (Commercial clean vehicles)
December 31, 2025: Residential energy credits expire:
- 25C (Home improvement)
- 25D (Residential clean energy)
June 30, 2026: Construction must begin for commercial building credits
- 179D (Commercial buildings)
- 45L (New efficient homes – must be acquired)
July 4, 2026: Solar and wind construction deadline for continued credits:
- Projects must be operational by December 31, 2027

Lock in timelines now, build a client outreach list, and prequalify vendors and document eligibility so credits don’t slip away at filing time.

How the OBBB Redefines Tax Management for Advisors

The advisors who will differentiate themselves are those who understand the difference between tax preparation, tax planning, and tax management.

Only tax management offers strategic positioning throughout the year and across decades.

Consider developing these capabilities in light of the changes.

These are the most immediate ways to apply OBBB tax changes to real-world client planning:

Advanced SALT planning for high-income clients
Charitable bunching and donor-advised fund strategies
Multi-year Roth conversion planning
Business entity optimization with accumulated earnings tax awareness
Family wealth transfer strategies that balance estate and income taxes

The numbers are compelling to clients and help articulate the importance of this moment.

You can help a client layer income efficiently and save $15,000 or more annually. Or perhaps you implement Roth conversions and preserve millions for the next generation.

These measurable value-adds help justify advisory fees and create client loyalty.

Get Specialized Support in Tax Management

At C2P, we help you build expertise in tax management and holistic planning strategies. These skills differentiate your practice and help you provide extraordinary value during major legislative changes like the OBBB. Schedule a free call to explore how our proven frameworks can help you serve your clients to the fullest.

Reach out, and we’ll explore how our proven frameworks can help you serve your clients to the fullest.

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Continue Your Professional Development and Prep for the OBBB

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Breaks down every provision
Provides granular implementation strategies
Includes client talking points

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Watch: Proactive Client Communication Opportunities

The OBBB can be a powerful client acquisition and retention tool for advisors who act decisively. We created this video summary for your clients immediately after the bill passed. It helps them understand the key provisions before they have a chance to worry. Watch the video.

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For Financial Professional Use Only. This information is for educational purposes and not intended as individual investment, tax, or legal advice. Tax laws frequently change—consult with qualified professionals for current guidance.