A Personalized OBBBA Assessment

 

One of the benefits of being a professional financial educator is the ability to use knowledge and skills gained through professional development experiences and work projects to enhance my own personal finances. I started my financial education career 50 years ago and it has proved invaluable personally as a resource to gradually build wealth. Knowledge is, indeed, power!

Case Example: OBBBA

A recent example of how my financial education career intersects with my life was the need to quickly digest the content of the 900+ page One Big Beautiful Bill Act (OBBBA) that was signed into law on July 4. Several clients wanted written content about it and class slides needed to be updated. To be clear, the word “beautiful” is not a personal opinion but part of OBBBA’s title.

OBBBA Resources

To gain needed background information, I collected articles about OBBBA and also went to the ultimate source of information about legislative changes related to personal finance: Kitces.com. Nobody provides a better summary and analysis of legislation than this talented team of financial researchers and writers. Their work is truly outstanding, including analyses of the 2017 Tax Cuts and Jobs Act (TCJA) and the SECURE and SECURE 2.0 acts affecting retirement planning.

Personal  OBBBA Applications

As I delved into the details about OBBBA, I started to think about its application, personally, for the income taxes I file jointly with my husband (i.e., mfj). At the end of a blog post for one client, I encouraged readers to do a personal OBBBA analysis to inform their future financial plans. OBBBA is a very wide-ranging piece of tax legislation that will affect individuals and families at different ages, income levels, and lifecycle stages very differently. Below is an example:

Three Key OBBBA Impacts

After studying up on OBBBA, I concluded that I will be positively affected in three main ways:

Extension of TCJA Tax Rates and Tax Brackets- The seven marginal tax rates (10%, 12%, 22%, 24%, 32%, 35%, and 37%) currently in effect were made permanent instead of increasing to 2017 levels if the TCJA had been allowed to expire.

Higher Standard Deduction- OBBBA increased the 2025 standard deduction to $31,500 (up from $30,000) for married couples filing jointly (mfj). In addition, as a couple both age 65+, my husband and I get an additional $1,600 apiece for a total standard deduction in 2025 of $34,700.

 

Charitable Deduction for Non-Itemizers- Like about 90% of American taxpayers, we have not itemized deductions since TCJA took effect in 2018. Starting in 2026, OBBBA will introduce an above-the-line cash charitable contribution deduction for non-itemizers: $2,000 for mfj.

 

Irrelevant OBBBA Features

I also concluded that there are a lot of OBBBA features that do not pertain to me personally. I am ineligible for the new senior tax deduction, pay less than $4,000 in SALT tax (there is no state income tax in Florida!), do not work for tips, and do not work overtime for an employer. In addition, I do not have minor children or a home mortgage and have no plans to buy a new car.

Bottom Line

Take the time to do an OBBBA analysis for your own tax filing status (e.g., single, mfj). Then convert what you learn into financial action steps. For example, you may need to adjust your tax withholding during the remaining months of 2025. You cannot expect your employer, the Social Security Administration, or other entities that withhold taxes to make any automatic changes to your withholding.

This post provides general personal finance or consumer decision-making information and does not address all the variables that apply to an individual’s unique situation. It does not endorse specific products or services and should not be construed as legal or financial advice. If professional assistance is required, the services of a competent professional should be sought.