Trump’s ‘Big Beautiful Bill’ Brings Major 2025 Tax Changes — Here’s What It Means for You

President Donald Trump’s newly passed “Big Beautiful Bill” is shaking up the U.S. tax code in 2025, bringing with it a wide range of tax updates that impact working families, older Americans, and high-income earners. Signed into law on July 3, the bill revives and expands key parts of Trump’s 2017 tax overhaul, with added twists.

Here’s what you need to know about the biggest tax changes starting in 2025 and how they might affect your wallet.

Permanent Extension of Trump’s 2017 Tax Cuts

The core of the bill locks in Trump’s 2017 tax cuts, which were originally set to expire in 2025. This includes:

• Lower federal tax brackets
• Higher standard deductions
• Expanded Child Tax Credit

Key 2025 updates include:

• Standard Deduction:
  • $15,750 (up from $15,000) for single filers
  • $31,500 (up from $30,000) for married joint filers
• Child Tax Credit:
  • Increased to $2,200 per child (up from $2,000)

These updates aim to maintain lower overall tax liability for most middle-income households.

 A Boost — and a Trap — for SALT Deductions

The State and Local Tax (SALT) deduction cap rises from $10,000 to $40,000 for 2025. However, this comes with a catch.

• The higher cap phases out for incomes between $500,000 and $600,000.
• This creates an effective 45.5% marginal tax rate in that range — dubbed the SALT torpedo.

Sweet Spot: Taxpayers earning $200,000 to $500,000 stand to benefit most from this change.

Temporary Deductions for Seniors, Workers, and Borrowers

The bill also includes temporary tax breaks aimed at specific groups, starting in 2025:

• $6,000 Bonus Deduction
  For individuals 65 and older, phasing out at:
  • $75,000 for single filers
  • $150,000 for married couples filing jointly
• New Deductions for:
  • Tip income
  • Overtime earnings
  • Auto loan interest

Eligibility criteria vary, but these changes are designed to benefit hourly and service workers, as well as retirees with fixed incomes.

ACA Premium Tax Credit Expansion Ends

One area not renewed in the bill: the enhanced premium tax credit from the pandemic era.

• That subsidy helped over 22 million Americans afford Marketplace health plans.
• Without it, ACA premiums will rise in 2026 for many households.

The “subsidy cliff” returns — meaning even $1 over the income threshold could eliminate your tax credit.

For 2025, the cliff kicks in at 400% of the federal poverty level, or $103,280 for a family of three.

Plan Ahead: Tax Strategy Now Matters More

Financial advisors are urging taxpayers to review their 2025 income projections and filing strategies. Without careful planning, you might lose out on key deductions or face surprise tax spikes, especially if you fall near phaseout thresholds.

Whether you’re a salaried worker, retiree, or investor, it’s time to reevaluate your approach before 2025 filings begin.

More… 

• https://www.claconnect.com/en/resources/articles/25/tax-bill-changes
• https://www.investopedia.com/2025-tax-deduction-changes-big-beautiful-bill-11772959
• https://www.nbcmiami.com/news/business/money-report/trumps-big-beautiful-bill-includes-these-key-tax-changes-for-2025-what-they-mean-for-you/3662157