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

A New Era in Tax Policy and Opportunity

The One Big Beautiful Bill Act (OBBB) is nearly 1,000 pages long, but you don’t need to read it all to make informed financial moves. Whether you're approaching retirement or running a business while planning for your family's future, the real question is: What can you do now, before the end of 2025, to take full advantage of these sweeping changes?  

This guide cuts through the complexity and highlights some of the most relevant, time-sensitive actions you can take today to help protect your wealth, potentially reduce your tax burden, and work toward setting your family up for long-term success.

The One Big Beautiful Bill in Practice

Meet Mark, a 64-year-old HVAC business owner in Grapevine, who’s preparing for retirement. Thanks to the OBBB, Mark may be able to begin transferring wealth tax-free, sell part of his business with minimal tax impact, and set up legacy accounts for his grandchildren—all before the end of 2025. These moves could save his family millions and secure their financial future.

Here’s the Short Version

At its core, the One Big Beautiful Bill is designed to ease the tax burden for everyday Americans, especially middle- and working-class families. It locks in a larger standard deduction of $31,500 for joint filers, meaning many people will owe less in taxes and may not need to itemize deductions, saving both time and money.

Families benefit from an increased Child Tax Credit of $2,200 per child. Workers in service or hourly roles can exclude up to $25,000 in tip income and $25,000 in overtime pay from taxes. Seniors aged 65 and older get an extra $6,000 deduction, reducing their taxable income and stretching retirement dollars further. And for those financing a new car, there’s a deduction of up to $10,000 in interest for U.S.-assembled vehicles.

Add in the expanded State and Local Tax (SALT) Deduction cap for those in high-tax states, and the result is a positive one; potentially more take-home pay, more breathing room in your budget, and more opportunities to save, invest, and plan for the future.

Some Brief Background for Context

In 2017, the Tax Cuts and Jobs Act nearly doubled the standard deduction, resulting in a larger tax break for most Americans. Building on that legislation, the OBBB makes many of those provisions permanent and introduces new, targeted benefits designed to support working families, retirees, and business owners.

Starting in 2025, the standard deduction is projected to increase annually with inflation, which should help your tax break grow as the cost of living rises.

Why Timing Matters

Many of the most generous provisions in the One Big Beautiful Bill Act are time sensitive. For example, the expanded SALT deduction cap and exclusions for tip and overtime income are set to phase out after 2028. Acting before the end of 2025 could lock in the most favorable terms while they are fully in effect. Delaying action could mean missing out on significant tax savings and wealth transfer opportunities.

How Can the Bill Help You?

For Retirees: Top 5 Moves You Can Take Before 2025 Ends

1. Maximize the Senior Deduction: If you're 65 or older, you now get an extra $6,000 on top of the standard deduction. Consider accelerating income (like IRA withdrawals or Roth conversions) into 2025 to take advantage of this larger cushion.

2. Rethink Roth Conversions: With tax brackets locked in and indexed for inflation, now is a good time to convert traditional retirement accounts to Roth IRAs at predictable rates.

3. Gift Strategically: The $30 million estate and gift tax exemption is historically high. You can use this window to transfer wealth to heirs through trusts or direct gifts before any future political changes reduce this benefit.

4. Use the SALT Cap Expansion: The SALT deduction cap has been raised to $40,000 through 2030. If you live in a high-tax state, this could significantly reduce your federal tax bill.

5. Review Your Income Mix: With tips and overtime excluded up to $50,000 (phasing out at $300,000 AGI), retirees with part-time work or investment income should reassess how they draw income to stay in favorable tax zones.

For Business Owners: 6 Strategic Moves to Explore

1. Accelerate Equipment Purchases: 100% bonus depreciation is back and permanent. You can buy and place equipment in service before year-end to deduct the full cost immediately.

2. Leverage Section 179 Expensing: The cap is now $2.5 million. If you’re investing in software, vehicles, or machinery, this is a good opportunity to write off more upfront.

3. Optimize for the 20% QBID: The Qualified Business Income Deduction is now permanent. Review your business structure to see that it is aligned to fully benefit.

4. Plan for a Future Exit: The exclusion on small business stock gains has increased to $15 million per shareholder. If you’re planning to sell your business, this could be a game-changer.

5. Invest in Innovation: Starting in 2025, R&D expenses can be fully deducted in the year incurred. If you're developing new products or tech, this could be the time to ramp up.

6. Review Succession & Estate Plans: Combine the $30 million exemption with business valuation strategies to potentially transfer ownership tax-efficiently.

Bonus: For Families & Legacy Builders

• Children’s Savings Accounts: Contribute up to $5,000/year per child. If your child is born between 2025–2028, the government could add a $1,000 bonus. These accounts grow tax-free and convert to IRAs at age 18.

• Expanded 529 & HSA Use: More flexibility means you can now use these accounts for tutoring, testing, and broader healthcare needs, great for multigenerational planning.

What You Can Do Now

Here’s how you can make the most of the OBBB, whether you’re a GDS client or just starting your financial journey:

• Schedule a Strategy Session: The bill’s complexity means a one-size-fits-all approach will likely not work. Let’s tailor a plan to your goals.

• Review Your Estate Plan: If your estate exceeds $10 million, now is a good time to reassess your strategy to see that you’re maximizing all available tax advantages and wealth transfer opportunities.  

• Evaluate Business Structures: Review your entity type and compensation model to see that they align with the new tax landscape.

• Maximize New Deductions: Seniors, hourly workers, and parents should explore how to capture every available benefit.

Final Thoughts: A Beautiful Bill, But Not a Simple One

The One Big Beautiful Bill is a landmark in tax policy, and there is complexity in the details. At GDS Wealth Management, we’re committed to helping you navigate those details with clarity, confidence, and a strategy that’s as unique as your financial goals.

If you’re ready to turn this legislation into opportunity, we’re ready to help. Email us at gds@gdswealth.com or call 469-212-8072 today.