The One Big Beautiful Bill: What It Means for Your Wealth
The “One Big Beautiful Bill” (OBBBA), signed into law on July 4, 2025, brings significant changes to the tax law in 2026. Whether you’re building wealth mid-career, growing a business, or approaching retirement, these provisions create new opportunities. Navigating them may seem complicated, but it doesn’t have to be.
Let’s break down the complexity and explore what these changes mean for your financial goals.
Understanding the Big Picture
The OBBBA makes permanent many tax provisions from 2017 that were set to expire, while introducing new benefits for working Americans, seniors, and business owners. The goal? Tax stability and relief that helps you plan confidently for the long term.
Some provisions took effect retroactively in 2025, while others began this year and extend through 2028.
Here’s what matters most for your situation:
Building Your Foundation
If you’re in the wealth-building phase, these 2026 tax changes help you keep more of what you earn—giving you resources to invest in what matters most.
Permanent Tax Relief You Can Count On
Lower tax rates and larger standard deductions are now permanent. For 2026, that’s $16,550 for single filers and $33,100 for married couples. This stability means you can plan ahead with confidence, knowing your tax situation won’t suddenly shift.
Relief for Tips and Overtime (2025-2028)
If you work in service industries or earn overtime, you can now deduct up to $25,000 for qualified tips and up to $12,500 for the “time-and-a-half” portion of overtime ($25,000 for joint filers). These deductions phase out at higher incomes but offer meaningful relief for mid-income earners.
Car Loan Interest Deduction (2025-2028)
Financing a new vehicle? You can now deduct up to $10,000 annually on interest for new car purchases if the vehicle was assembled in the US. The deduction phases out above $100,000 income ($200,000 for joint filers). Note that used vehicles and leases don’t qualify, and must be for personal use.
Enhanced Support for Families
The Child Tax Credit increases to $2,200 per qualifying child, with up to $1,400 refundable. For families with multiple children, this means more resources to invest in their futures—whether that’s college savings, family experiences, or the goals that matter to you. You may also be eligible for additional state options depending on your state of residence.
For Business Owners and Entrepreneurs: Investing in Growth
Your business is part of your legacy. These tax changes create powerful opportunities to reinvest in growth while reducing your tax burden.
100% Bonus Depreciation Reinstated
With recent changes, you’re now able to deduct the entire cost of qualifying business property in the first year if acquired after January 19, 2025. Considering an equipment upgrade or investing in new technology? This is an ideal time to move forward and boost your cash flow.
Section 179 Expensing Doubled
The limit jumped to $2.5 million (with a phase-out at $4 million), allowing small and mid-sized businesses to immediately deduct substantial amounts for property and equipment. This is about giving you flexibility to grow on your timeline.
R&D Expensing: Incentivizing Innovation
Immediately deduct 100% of domestic research and development expenses starting in 2025. Even better: if you capitalized R&D expenses from 2022-2024, you can deduct the unamortized amount now. For businesses investing in innovation, this significantly improves cash flow.
QBI Deduction: Permanent and Enhanced
The 20% qualified business income deduction for pass-through entities is now permanent, with an expanded phase-in range. For 2026, more service-based businesses qualify as income thresholds increase to $75,000 for single filers and $150,000 for joint filers.
Qualified Small Business Stock: Bigger Opportunities
The QSBS exclusion jumped from $10 million to $15 million (or 10x cost basis) for stock issued after July 4, 2025. If you’re a founder, an early employee with equity, or an angel investor, this expansion offers significant tax-free wealth-building potential.
For Those Approaching or in Retirement: Protecting Your Legacy
Retirement is when your wealth transitions from accumulation to distribution—from building to living. These 2026 tax changes help you navigate that shift with confidence.
New $6,000 Senior Deduction (2025-2028)
At 65 or older, you receive an additional $6,000 deduction ($12,000 for couples where both qualify). This comes on top of existing standard and senior deductions, and it phases out above $75,000 income ($150,000 for joint filers).
For those managing required minimum distributions and other retirement income, this reduces taxable income and helps your savings last longer.
Estate Tax Exemption: Passing Down Your Legacy
Starting in 2026, the estate and gift tax exemption increases to $15 million per person ($30 million for couples), with annual inflation adjustments. This permanence allows you to confidently plan how you’ll pass down wealth—whether that’s a family business, real estate, or financial assets—to the next generation.
HSA Expansion: Smart Healthcare Planning
Bronze and catastrophic health plans now qualify as HSA-compatible starting in 2026, and telehealth services can be used before meeting your deductible. HSAs remain one of the most tax-efficient tools for healthcare costs—contributions are deductible, growth is tax-free, and withdrawals for medical expenses are tax-free.
What You Should Do Now
Understanding these changes is one thing. Knowing how to apply them to your unique situation is what creates real value. Here’s where to start:
- ✔ Check your withholding: Because many 2025 provisions are retroactive, tax refunds in early 2026 will be larger than usual. Consider adjusting your 2026 withholding to capture the benefit throughout the year.
- ✔ Reassess business investments: With permanent bonus depreciation and enhanced expensing, this may be the right time to move forward with equipment or technology purchases you’ve been considering.
- ✔ Update your retirement strategy: If you’re 65 or older, factor the new $6,000 deduction into your withdrawal planning. You may be able to take larger distributions while staying in a favorable tax bracket.
- ✔ Revisit estate planning: The higher exemption creates new opportunities for strategic wealth transfer. Acting now can lock in today’s value while removing future appreciation from your taxable estate.
- ✔ Explore Opportunity Zones: If you have significant capital gains, enhanced rural QOZ incentives may align with your investment goals.
How We Can Help
Tax legislation is inherently complex, with multiple provisions, varying timelines, and eligibility requirements that interact in different ways for different people. While we’re not tax professionals and cannot provide tax advice, we understand how these changes can impact your overall financial plan.
We can help you see the big picture: how tax law changes affect investment strategies, retirement planning, and estate considerations, so we can work together to support your goals.
If you’re ready, schedule your consultation with a member of our team.
Any opinions are those of Chris Hilyer and not necessarily those of Raymond James. Expressions of opinion are as of this date and are subject to change without notice. Raymond James and its advisors do not offer tax or legal advice. You should discuss any tax or legal matters with the appropriate professional. Investing involves risk and you may incur a profit or loss regardless of strategy selected. Prior to making an investment decision, please consult with your financial advisor about your individual situation.
