From Beautiful to Beneficial: New Tax Planning Opportunities
The “One Big Beautiful Bill Act” (OBBBA) introduces several temporary and permanent tax changes, giving taxpayers meaningful planning opportunities. The focus now shifts from what the law says to how you can use it, before certain provisions are phased out.
Key Tax Planning Opportunities
- Maximize Roth strategies, while rates stay low. The OBBBA makes the 2017 tax cuts permanent, which lowers marginal rates, and expands the standard deductions. This creates favorable conditions for Roth conversions, particularly for those expecting higher future income or required minimum distributions. “Bracket filling” or strategically converting up to the top of the 12% or 24% bracket can lock in long-term tax savings. High earners should also evaluate maximizing backdoor Roth IRA contributions and possibly Roth 401(k) contributions.
- Prepare for the new senior deduction. Begun in 2025 and lasting through 2028, taxpayers ages 65+ may receive up to a $6,000 deduction ($12,000 for couples). Take the time to review 2025 income projections, consider delaying income or plan qualified charitable distributions (QCDs), to reduce modified adjusted gross income (MAGI) and maximize this temporary benefit.
- Manage MAGI, to leverage the expanded state and local tax (SALT) cap. The SALT deduction cap temporarily increases from $10,000 to $40,000 through 2029, but phases out above $500,000 of MAGI and disappears above $600,000. Taxpayers can reduce MAGI, through pre-tax retirement contributions or QCDs. Strategic income management could preserve thousands of dollars in additional deductions.
- Take advantage of bonus depreciation for business owners. The OBBBA restores 100% bonus depreciation for qualified property placed in service after Jan. 19, 2025. Plan equipment purchases, arrange financing, or begin cost segregation studies, to maximize deductions next year.
- Start planning for estate and gift opportunities. Beginning in 2026, the estate and gift exemption will be permanently set at $15 million per person. This is a strong planning window, to evaluate gifting strategies, review trusts and identify assets that may benefit from valuation discounts or long-term transfer planning.
The OBBBA presents a rare mix of temporary incentives and long-term stability. Now is the ideal time to align income, deductions and business planning, so you can turn this legislation into meaningful financial benefit.
Anderson Financial Strategies can help put the OBBBA to work for you. Contact us at andersonfinancialstrategies.com or 855-237-4545.
