Big Beautiful Bill.

This summer, Congress passed the “One Big Beautiful Bill” (often shortened to OBBBA). The bill was certainly big, they all are!  Was it beautiful? Well, what’s that saying, “Beauty is in the eye of the beholder”?  We’ve been reviewing some of the key provisions in meetings, which I’ve noted below.

• Tax Brackets Made Permanent: The lower tax brackets and larger standard deduction first introduced in 2017 are now permanent. This creates long-term planning opportunities, especially for Roth conversions.
• Bonus Senior Deduction (2025–2028): Retirees age 65 and older can claim an additional $6,000 tax deduction ($12,000 if both spouses qualify). There are income phaseouts for this benefit, so not everyone will benefit, but many will.  This change was motivated by a move to reduce federal income tax on Social Security benefits.
• Charitable Deduction Restored: Beginning in 2026, even non-itemizers can deduct up to $1,000 ($2,000 for couples) in charitable giving. This is a win for retirees who want to give back but normally take the standard deduction. 
• No Tax on Tips: Yes, if you were thinking about picking up a shift at O ’Charley’s, your first $25,000 in tips will escape federal income taxation!

What this means for you: The next three years (2025–2028) create a tax-planning “sweet spot.” If you’re considering Roth conversions, charitable giving strategies, or other moves to reduce your lifetime tax bill, this may be the time to act.

What we can’t miss either is that while taxes are one of the certainties in life, they don’t stay the same.  When I asked Google how many times the federal income tax has been changed since its beginning in 1913, this was the response, “It is impossible to provide an exact number of changes to the federal income tax….the tax is not a single, static, law, but an entire section of the U.S. Code that is constantly being amended, revised, and reinterpreted.”  Absolutely!

For this reason, reviewing your tax situation each year is part of the planning we endeavor to do for you.  In our regular review meetings, we get personal updates, new goals and provide perspective and advice on your portfolio, but we also check in to see if your tax situation has changed and what you might do about it.  We’ve enjoyed seeing you during our Fall meetings!

Any opinions are those of Landon Vick and not necessarily those of RJFS or Raymond James. The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee that it is accurate or complete; it is not a statement of all available data necessary for making an investment decision and it does not constitute a recommendation. Raymond James and its advisors do not offer tax or legal advice. You should discuss any tax or legal matters with the appropriate professional. Be sure to contact a qualified professional regarding your particular situation before making any investment or withdrawal decisions.