The passage of the “Big Beautiful Bill” on July 4 has ignited varying sentiments across political parties, prompting multiple discussions about its vast implications. While there’s plenty of commentary on what the bill will mean for Americans more generally, certain aspects of the legislation will be especially relevant for advisors and their clients.
Among its many provisions, the new legislation brings sweeping changes to the tax code — from increased estate tax exemptions and expanded deductions to new savings vehicles and other opportunities. With so many changes in play, it can be easy to get lost in the considerations that stand to impact taxpayers the most.
Financial advisors who can cut through the complexity and extract clear, actionable insights will have an upper hand in getting ahead of their clients’ planning needs.
Key Provisions To Review With Clients
Here’s a breakdown of some of the key provisions that might be of particular interest for financial professionals and their clients:
Increased Estate Planning Exemption
Effective in 2026, the estate tax exemption will increase from $13.99 million to $15 million per person (indexed for inflation) or $30 million per married couple with portability.
Actionable Insight:
This higher exemption provides ultra-high net worth families more room to plan. However, political shifts could threaten its longevity, and this window is unlikely to remain open indefinitely. With that in mind, now is the time to revisit gifting strategies, trusts and dynasty planning with clients.
SALT Cap Changes
The cap on state and local tax (SALT) deductions will increase to $40,000. However, the benefit phases out for taxpayers with adjusted gross income (AGI) between $500,000 and $600,000 and sunsets after 2029. These thresholds are not doubled for joint filers.
Actionable Insight:
Clients in high-tax states with AGIs near the phaseout range are in a planning “danger zone.” Advisors should revisit income-splitting strategies, filing status and deduction timing.
Income Tax Brackets & Standard Deductions
The current seven-bracket system (with tax rates of 10%, 12%, 22%, 24%, 32%, 35% and 37%) is now permanent (barring a future congressional change).
Actionable Insight:
This offers long-term visibility for Roth conversion strategies, bracket management and retirement distributions.
Standard Deduction & New Senior Deduction
Starting in 2025, the standard deduction will increase to:
- $31,500 for married filing jointly (MFJ)
- $15,750 for single filers
- $23,625 for heads of households (HOH)
A $6,000 senior deduction will apply per taxpayer age 65 or older but phases out for those earning above $150,000 (MFJ) or $75,000 (others). It expires after 2028.
Actionable Insight:
This is a strong lead-in for broader retirement income planning. Modeling income distributions and optimizing tax-efficient withdrawals for seniors near the phaseout cliff could add significant value.
Business Owner Provisions
Bonus depreciation is reinstated at 100% for assets placed in service after Jan. 20, 2025. The Section 179 deduction limit rises to $2.5 million, with a phaseout beginning at $4 million.
Actionable Insight:
Business owners now have expanded tools for capital expenditures. Advisors should consider updating cost segregation studies and evaluating acquisition timelines.
The Qualified Business Income (QBI) deduction (also known as the Section 199A deduction) is extended with modestly expanded income phaseouts. Income limitations still restrict white-collar professionals.
Actionable Insight:
Reassessing business-owner income levels, entity structures and overlooked deductions can potentially uncover new planning opportunities.
529 Plan Expanded Flexibility
Distributions of 529 plans may now be used for a broader range of kindergarten to 12th grade and homeschool-related expenses as well as “recognized” post-secondary and career credentialing, including:
- Curriculum and instructional materials
- Books or digital educational content
- Tutoring and outside‑home educational classes
- Testing fees
- Dual enrollment tuition
- Educational therapies and adaptive learning tools
- “Recognized’ professional credentialing, which may potentially include preparatory work such as CFP, CPWA, CPA and attorney bar exam preparation.
Actionable Insight:
These changes may help expand educational opportunities, manage overfunded balances and support long‑term multigenerational educational strategies.
QSBS Exclusion Expansion
There’s a new tiered capital gains exclusion for Qualified Small Business Stock (QSBS) issued after July 4, 2025:
- 50% exclusion after three years
- 75% after four years
- 100% after five years
Additionally:
- The per-issuer exclusion cap increases from $10 million to $15 million, indexed for inflation beginning in 2027.
- The gross asset limit for eligible companies increases from $50 million to $75 million (inflation-adjusted).
- Stock issued before July 4, 2025, is subject to prior rules.
Actionable Insight:
This change expands planning flexibility, especially for early exits. Advisors should revisit QSBS-related gifting, non-grantor trust strategies and Section 1045 rollovers while preparing for heightened IRS scrutiny.
New Child-Focused Savings Vehicles
Trump Accounts:
Families may contribute up to $5,000 annually per child under age 18 for Trump accounts. Employers can contribute an additional $2,500 tax-free and an IRS pilot program adds $1,000 for children born between 2025 and 2028.
Actionable Insight:
This presents an opportunity to discuss long-term child savings strategies and introduce multigenerational wealth discussions. It receives IRA-like tax treatment, with no upfront deduction.
Additional Deductions
Tax-free tips and overtime deductions: From 2025 to 2028, certain service workers will pay no income tax on tips. All workers may exclude a portion of overtime earnings from taxable income.
Non-itemizer charitable giving: Beginning 2026, taxpayers taking the standard deduction can claim up to $1,000 ($2,000 for MFJ) in an above-the-line deduction for certain charitable contributions.
Vehicle loan interest deduction: From 2025 to 2028, taxpayers can deduct up to $10,000 per year in interest on qualifying new and used vehicle loans, with phaseouts at $200,000 of modified adjusted gross income for MFJ and $100,000 for others.
Actionable Insight:
Keeping these tax advantages top of mind and sharing with clients as relevant could prove valuable for clients seeking insight on how to optimize their tax liability.
Turning Complexity Into Clarity
The “Big Beautiful Bill” delivers complexity while opening the door to powerful planning conversations.
Clients will naturally look to their advisors to help make sense of these changes.
Clients will naturally look to their advisors to help make sense of these changes, prioritize what matters most and translate new provisions into clear, actionable strategies. By engaging early, modeling potential outcomes and guiding clients through decisions with confidence, advisors can reinforce their role as trusted partners.
Dave Haughton is Senior Corporate Counsel at Wealth.com, a wealth management industry estate planning platform.
