Most likely, you’ve heard talk in the news—or on the internet—about the new "Big Beautiful Bill" (BBB). This bill includes sweeping changes to the tax code, many of which could impact how you save, spend, give, and plan for the future.
Now, before your eyes glaze over, let me say this: the BBB is more than just policy wonkery. It’s a potential shift in how your financial plan might take shape for the next decade—or longer.
As a fiduciary financial planner with 23 years in the business (and a healthy Midwestern appreciation for clear, no-nonsense advice), I want to break down what this bill means for you—whether you're still working, running a business, raising a family, or planning your legacy.
If you find yourself wanting to talk about all this, just schedule a visit with me. I love helping families stay on track to reach their financial goals.
What Is the Big Beautiful Bill—and Why It Matters
The Big Beautiful Bill Act introduces permanent and temporary changes to the tax code. It impacts nearly every area of financial planning—from retirement income and charitable giving to business taxes and estate strategies. Let’s walk through the key updates and how they could affect your plan.
Good News: Lower Tax Rates Made Permanent
The individual income tax rates from the 2017 Tax Cuts and Jobs Act (TCJA) are now permanent starting in 2026, with annual inflation adjustments.
What it means for you: We can plan confidently around current brackets. If you're considering Roth IRA conversions or managing Medicare surcharges and the 3.8% Net Investment Income Tax, we’ll continue optimizing income thresholds to keep taxes low.
Standard Deduction Increases and Charitable Giving Perks
Beginning in 2025:
- Standard deduction increases to $31,500 for couples and $15,750 for individuals.
- Starting in 2026, non-itemizers can deduct up to $2,000 (married) or $1,000 (single) for charitable giving.
Heads-up for high earners: In 2026, the first 0.5% of charitable donations will no longer be deductible, making front-loading or using donor-advised funds before the change a smart move.
SALT Deduction Expansion: What It Means for Minnesotans
The state and local tax (SALT) deduction cap rises from $10,000 to $40,000—great news in high-tax states like Minnesota. But it begins to phase out at $500,000 income and expires in 2029.
Planning tip: Consider bunching deductions or accelerating property tax payments to maximize this while it lasts.
Tax Breaks for Seniors: Bigger Deductions in Retirement
From now through 2028, seniors (65+) can claim an extra $6,000 standard deduction per person. Couples could see up to $12,000.
Planning tip: Time your withdrawals to avoid phasing out this deduction. Tax-free income from Roth accounts can help.
Estate and Gift Tax Exemptions Are Going Up
Starting in 2026, the lifetime exemption increases to $15 million per individual, or $30 million per couple.
What to do now: Review your estate plan. This change opens up opportunities for tax-smart gifting and trust planning.
Business Owners: The QBI Deduction Is Here to Stay
The 20% Qualified Business Income (QBI) deduction is now permanent for pass-through business owners (LLCs, S corps, partnerships).
Next steps: Consider whether your business structure still fits your needs. Adjusting compensation or electing S corp status could reduce your tax burden.
New Savings Opportunities for Children and Families
Beginning in 2026, new "child savings accounts" (or "Trump Accounts") can be opened for children under 18. These accounts grow tax-deferred and convert into traditional IRAs at age 18. Eligible children born between 2025– 2028 may receive a $1,000 government match.
Strategy tip: Combine with 529 plans or custodial Roth IRAs to build a robust financial start.
More Flexibility with 529 Plans and ABLE Accounts
529 plans can now be used for:
- Professional licenses and certifications
- K–12 education (limit increased to $20,000 annually)
ABLE account improvements include:
- Permanently higher contribution limits
- Indefinite tax-free rollovers from 529 plans
If you’re supporting a loved one with a disability: These expanded tools can help build long-term security.
Deductions for Tips and Overtime Income
Temporary deductions now apply for:
- Tip income (up to $25,000 annually)
- Overtime income ($12,500 for singles, $25,000 for couples)
Planning angle: These benefits phase out for high earners, so coordination with your tax strategy is key especially for younger workers or those in service industries.
5 Smart, Tax-Savvy Moves to Consider Now
- Review your tax bracket and explore Roth conversions.
- Revisit your estate plan to align with new exemptions.
- Optimize charitable giving before deductibility changes.
- Evaluate 529 and ABLE plans to maximize flexibility.
- Check deductions related to tips, overtime, and senior benefits.
Why Work with a Fiduciary Financial Planner
Tax laws are always changing. The BBB locks in some updates, but future changes are inevitable. That’s why I focus on "no regrets" strategies—moves that work today and hold up even if the rules shift.
As a CERTIFIED FINANCIAL PLANNER™ and Behavioral Financial Advisor, I help families harmonize their financial lives with the tax code—without selling products or earning commissions.
If you’d like help navigating these updates, let’s schedule a visit. I work with clients across the country from my office in West Saint Paul, Minnesota, and I’m always happy to meet new people.
Dunncreek Advisors does not provide legal or tax advice. This content is for informational purposes only. Please consult your CPA or attorney for personalized guidance.
Frequently Asked Questions (FAQs):
1. What is the Big Beautiful Bill and how does it affect my taxes?
The Big Beautiful Bill (BBB) is a new law with major tax changes. It affects tax brackets, deductions, and planning strategies like Roth conversions and charitable giving.
2. How does the Big Beautiful Bill impact retirement planning?
The BBB keeps current tax rates, raises the standard deduction, and adds senior tax breaks. These changes create new chances for smarter retirement income planning.
3. Are there new savings or tax strategies for families under the Big Beautiful Bill?
Yes. The BBB adds child savings accounts, expands 529 uses, and improves ABLE accounts. Tip and overtime deductions can also lower taxes for working families.
4. Should I update my estate plan because of the Big Beautiful Bill?
Yes. The estate tax exemption increases to $15 million in 2026. Now is a great time to review gifting strategies and trust plans.