“One Big Beautiful Bill Act” Signed Into Law

On July 4, 2025, President Trump signed into law a budget and reconciliation package known as the “One Big Beautiful Bill Act” (OBBBA). Key provisions of the act include the following:

• The permanent extension of certain major provisions of the Tax Cuts and Jobs Act of 2017 (TCJA), including the TCJA’s seven income tax brackets and the doubling of the standard deduction for individual taxpayers.
• Seniors over age 65 and blind persons can claim an additional amount of $1,600 as part of the standard deduction.
• A temporary increase in the cap on the state and local tax deduction (from $10,000 to $40,000 for taxpayers who make less than $500,000), with a reversion in the cap to $10,000 after 2029.
• For tax years from 2025 to 2028, tips, overtime, and car loan interest will not be taxable for taxpayers who meet certain criteria.
• An increase in the child care tax credit (from $2,000 to $2,200), subject to income thresholds and phase-outs.
• Most clean energy tax credits have been eliminated (e.g., the clean vehicle credit, the energy-efficient home credit).

For more information about these and other provisions of the OBBBA, see Deloitte’s July 1, 2025, Tax News & Views article.