The One Big Beautiful Bill: What It Means for Your Money

Tired of wondering where your tax dollars go? The One Big Beautiful Bill Act (OBBA) aims to transform the way government spending is managed while delivering substantial tax benefits to Americans at every income level.

Think of it as cleaning out 47 messy junk drawers in your house and organizing them into one efficient system. Or, better yet, upgrading from dial-up internet to fiber-optic cable. This sweeping legislation requires government programs to demonstrate measurable outcomes to continue receiving funding, creating unprecedented accountability and transparency in how your money is spent.

The most immediate impact for most Americans? Tax cuts that were scheduled to expire in 2026 are now permanent. Despite political rhetoric suggesting only those earning over $400,000 would see tax increases, the reality is that anyone making over $35,000 would face higher taxes without this fix. A household earning $50,000 would have paid an additional $1,200 to $1,800 annually, while those earning $150,000 could have seen nearly $10,000 in increased taxes. That uncertainty is now eliminated.

Beyond tax stability, OBBA delivers targeted benefits across the economic spectrum. The standard deduction will become permanently higher ($15,750 for singles and $31,500 for married couples in 2025). Residents of high-tax states get relief with a SALT deduction cap raised to $40,000. Service industry workers can deduct up to $12,500 in tips ($25,000 for couples), potentially saving thousands of dollars. Families see an increased child tax credit of $2,200 per child with expanded refundability, while seniors gain a special $6,000 deduction that could eliminate taxes on Social Security for millions.

Business owners receive certainty with a permanent 20% Qualified Business Income deduction, enhanced depreciation options, and simplified expense deductions. For estate planning, the exemption increases to $15 million per person starting in 2026, significantly reducing the complexity of succession planning for family businesses.

Whether you're a server earning tips, a parent raising children, a senior living on fixed income, or a business owner planning your legacy, OBBA contains provisions designed to put more money back in your pocket while demanding your tax dollars work harder and smarter.

Ready to learn how these changes impact your unique financial situation? Contact our team at Farrall Wealth to customize these powerful new tools to your unique financial goals.

Securities and advisory services offered through LPL Financial, a registered investment advisor. Member FINRA/SIPC.

The opinions voiced in this podcast are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which strategies or investments may suit you, consult the appropriate qualified professional before deciding.