As legislation goes, this one is turning heads.
Nicknamed the “One Big Beautiful Bill,” this sweeping tax package introduces a host of changes, some subtle, some substantial, that begin rolling out in 2025. From larger deductions to business-friendly incentives, there’s a little something for everyone.
But make no mistake: big opportunities often come with fine print. Especially for high-net-worth families.
At SteelPeak, we’ve combed through the details to help you get ahead of what’s changing, what it means for your plan, and where there may be room to optimize.
Let’s take a closer look.
What’s changing:
Starting in 2025, the standard deduction increases to:
Why it matters:
For many clients, especially those who don’t itemize, this is a simple win. It reduces taxable income and could nudge some households into lower tax brackets. While the increase is modest, it’s part of a broader effort to ease the overall tax burden.
What to consider:
This might affect your decision whether to itemize or take the standard deduction. With changes to SALT (see below), the math may look different in 2025 than it did before.
What’s changing:
The state and local tax (SALT) deduction cap jumps from $10,000 to $40,000 in 2025, with a 1 percent increase each year through 2029. Then, surprise, it drops back to $10,000 in 2030.
Why it matters:
This is a big deal for clients in high-tax states like California and New York. If you're used to having SALT deductions severely limited, this creates a five-year window of opportunity.
What to consider:
If you're thinking about large real estate purchases, renovations, or shifting residency, 2025 through 2029 could be prime planning years. But don’t assume this change is forever. Like many elements of the bill, it's temporary.
What’s changing:
Seniors age 65 and up get a “bonus” deduction up to $6,000 beginning in 2025. However, this new deduction phases out based on income and expires after 2028.
Why it matters:
This presents an excellent window to manage taxable income during retirement. For clients delaying Social Security or working part-time, it could be the difference between staying under or above certain Medicare thresholds or capital gains brackets.
What to consider:
Talk to your advisor about Roth conversions, timing of IRA withdrawals, or deferring income to maximize this benefit over the next four years.
What’s changing:
Starting in 2025:
Why it matters:
For younger earners or clients with adult children in the workforce, this change helps boost take-home pay. It could also influence how families structure compensation for personal staff, service businesses, or private employees.
What to consider:
This is another temporary benefit, so it may make sense to accelerate earning or payment strategies to take full advantage.
What’s changing:
Why it matters:
For entrepreneurs and closely held business owners, this is one of the bill’s most powerful sections. The QBI deduction, which had been at risk of sunsetting, is now enshrined, offering long-term planning stability.
The return of full capital expensing is also a meaningful incentive for reinvestment.
What to consider:
Whether you’re thinking of expanding your business, upgrading equipment, or shifting compensation strategies, these rules could improve your after-tax return. Talk to your tax advisor about aligning purchases or income distributions with the new code.
What’s changing:
Why it matters:
For families with young children or dependent relatives, these enhanced credits can meaningfully reduce tax liability.
What to consider:
Credits phase out at higher income levels, so careful income planning (such as deferring RSU sales or business income) could keep you eligible.
What’s changing:
Starting in 2026, the estate and gift tax exemption increases to:
Why it matters:
This pushes the federal exemption even higher than today’s level ($13.99M/$27.98M in 2025), offering more breathing room for large estates.
What to consider:
You don’t need to rush to gift in 2025. But it’s worth discussing with your estate attorney whether you want to:
Also: remember that this provision doesn’t take effect until 2026.
What’s changing:
Starting in 2026, non-itemizers can deduct:
Why it matters:
While modest, this change may encourage more giving from donors who don't itemize. It also adds one more layer of tax efficiency for those with regular charitable intent.
What to consider:
This is a good time to explore Donor-Advised Funds, qualified charitable distributions (QCDs) from IRAs, or family foundation strategies, especially if you plan to itemize some years and not others.
There’s a lot to like in the Big Beautiful Bill. But it’s a mixed bag of permanent, temporary, and phased changes, some of which expire as early as 2028, others that don’t even begin until 2026.
Which means the real strategy isn’t just knowing what’s in the bill.
It’s knowing when to act.
At SteelPeak, we’re already working with clients to take advantage of these windows—whether through tax-smart income planning, business structuring, or legacy strategies.
If you haven’t revisited your tax and estate plan in the last 12 months, now’s the time.
We’ll help you navigate the new rules with clarity, care, and confidence—so you can focus on what really matters: building and enjoying the life you’ve worked for.
Need a second look at your plan?
Let’s talk about how the new tax law could work in your favor.