Big Beautiful Bill Updates: What You Need to Know for 2025 Taxes

Taxes are changing, and if you’re planning your finances for 2025, it’s important to know what’s coming. The Big Beautiful Bill, signed into law by President Donald Trump in July 2025, brings several updates that can affect your deductions, credits, and overall tax planning. From changes in standard deductions to new benefits for seniors, knowing the details helps you prepare and avoid surprises.

Whether you file as a single person, head of household, or jointly with a spouse, some of these updates could directly impact your wallet. Let’s break it down in a simple, practical way so you can see what matters most.

Higher Standard Deductions and Senior Benefits

One of the biggest changes is the higher standard deduction. For 2025, married couples filing jointly can claim $31,500, single filers get $15,750, and heads of households receive $23,625. This increase helps reduce taxable income and may make filing simpler for many families.

In addition, if you’re over age 65, the bill adds an extra $6,000 benefit. This is designed to support retirement income and help seniors cover costs without additional tax burdens. It’s a straightforward way to get extra relief when filing your 2025 return.

Child Tax Credit Adjustments

Families with children also see changes. The child tax credit now includes an additional $200 per child, which can directly lower your tax liability. While it’s not a huge amount, every bit helps when budgeting for daily expenses, education, or holiday spending.

Bonus Depreciation for Property

For businesses and investors, one important update is 100% bonus depreciation for property placed in service from January 2025 onward. This means the full cost of qualifying assets, like machinery, equipment, or certain business property, can be deducted in the year it is put to use. This change allows businesses to reduce taxable income quickly and may improve cash flow significantly.

Changes to Deductible Expenses

Some deductions have been removed under the new law:

1. R&D research expenses are no longer deductible.

2. Energy credits are not available from 2025 onwards.

3. Other deductions like overtime pay, tips, and auto loan interest have been eliminated.

These changes mean that careful planning is required. If you previously relied on these deductions, you may need to adjust your financial strategy or look at other ways to optimize taxes.

State and Local Tax (SALT) Cap

The bill also adjusts the SALT deduction cap, raising it to $40,000 for people earning under $500,000. This helps many taxpayers in high-tax states claim a larger deduction on state and local taxes, which can reduce federal tax obligations.

Student Loans and Education Considerations

Education-related tax benefits are also updated. Some Pell Grants are considered tax-exempt income for qualifying students. At the same time, federal subsidized loans for undergraduates are removed, and new borrowing limits are introduced. Families and students should review these changes carefully to understand how they affect taxable income and financial aid.

Remittance Tax

Finally, the bill introduces a 1% tax on money sent abroad. If you regularly remit funds to family or for business, you’ll want to account for this new tax when budgeting.

Need Help Navigating the Big Beautiful Bill?

Understanding the Big Beautiful Bill and its impact on your taxes can be challenging. If you’re feeling uncertain about how these changes affect you, Anu Agrawal, CPA, is here to assist.

With over 10 years of experience in public accounting, Anu Agrawal offers personalized tax planning and advisory services tailored to your unique financial situation. Whether you’re an individual taxpayer or a small to medium-sized business owner, Anu Agrawal provides expert guidance to help you navigate the complexities of the new tax laws.

Contact Anu Agrawal, CPA, today to schedule a consultation and take the first step toward better tax management.

Questions You Might Have

1. What is the Big Beautiful Bill?

The Big Beautiful Bill, signed into law on July 4, 2025, is a comprehensive tax reform package that extends many provisions from the 2017 Tax Cuts and Jobs Act (TCJA) and introduces new tax rules affecting individuals and businesses starting in 2025

2. How does the new standard deduction affect me?

For the 2025 tax year, the standard deduction has increased:

• $31,500 for married couples filing jointly
• $15,750 for single filers
• $23,625 for heads of households

Additionally, individuals aged 65 and older are eligible for an extra $6,000 deduction, reducing taxable income further.

3. What changes have been made to bonus depreciation?

Starting in January 2025, businesses can claim 100% bonus depreciation on qualifying property placed in service. This allows for an immediate deduction of the full cost of eligible assets, enhancing cash flow and encouraging investment.

4. How does the SALT deduction cap change?

The State and Local Tax (SALT) deduction cap increases to $40,000 for taxpayers earning under $500,000. This change allows for a higher deduction of state and local taxes paid, potentially reducing federal taxable income for eligible taxpayers.

5. What changes have been made to bonus depreciation?

Starting in January 2025, businesses can claim 100% bonus depreciation on qualifying property placed in service. This allows for an immediate deduction of the full cost of eligible assets, enhancing cash flow and encouraging investment.