As your financial advisor, I want to highlightwhat may matter most to you — the opportunities, the risks, andthe next steps to take.
What’s Changing — and Why It Matters
Lower Taxes & Bigger Deductions
- Tax rates remain low, especially for individuals and families.
- The standard deduction is now higher.
- Overtime pay and tips are now tax-deductible (up to $12,500 and $25,000 respectively) — but only through 2028.
- For business owners, there's a 20% deduction for pass-through income, and you can now expense more equipment and R&D costs.
Takeaway: Many clients may see moretake-home pay. Business owners may see larger after-tax profits.
Higher Estate & Gift Exemptions
- The estate tax exemption has increased to $15 million per person ($30M per couple). Takeaway: This may be a great time to consider estate and gifting strategies if you haven’t already.
Fewer Energy & EV Incentives
- Tax credits for many electric vehicles, solar panels, and home upgrades are being phased out, some as soon as 2026. Takeaway: If you’re planning to go green, you may want to act sooner to capture remaining incentives.
Possible Impacts from Spending Cuts
- The bill cuts funding for programs like student loans, Medicaid, and food assistance.
- The national deficit may rise — which could affect interest rates or future tax policy. Takeaway: We’ll need to watch the economic effects. Some clients may face indirect risks, especially from rising rates or inflation.
Who Stands to Benefit Most?
- High-income individuals in high-tax states (thanks to a higher State and Local Tax (SALT) deduction cap).
- Small business owners and entrepreneurs.
- Families with large estates looking to pass down wealth.
- Employees with significant overtime or tip income.
What We Recommend Doing Now
- Review your tax plan for 2025–2028 — especially if you earn overtime or tip income.
- Consider major energy or vehicle purchases before the tax credits disappear.
- Business owners: revisit equipment purchases or R&D investments.
- High-net-worth clients: explore gifting or trust strategies to take advantage of the higher estate exemption.
- Stay flexible — many of these changes may expire after 2028 unless renewed.
Looking Ahead
Some of these benefits are temporary. Others could be reversed by future administrations. That’s why it could be important for you to act on today’s opportunities, but also prepare for policy shifts ahead.
We’ll continue to monitor the effects of this law and help you adjust as needed. In the meantime, don’t hesitate to reach out if you want to revisit your tax strategy, estate plan, or investment positioning.
Let’s make the most of this moment — wisely.
Read more articles by Anthony Perez