When “Permanent” Isn’t Permanent
- barmaley13
- Jul 7
- 3 min read
New tax rules sound good. But here’s what really matters for your wealth.
Congress passed the One Big Beautiful Bill Act (OBBBA), which makes key tax provisions permanent—starting in 2026. Here’s what it means for your wealth today and tomorrow.
1. Estate & Gift Tax Exemption: $15M per person, and yes, it’s truly permanent
2026 forward: Exemption set at $15 million per individual (or $30 million for a couple), and indexed for inflation
No drop-off in 2026: The old law had it falling to roughly $7 million—but that’s gone now.
Permanent—unless Congress changes it again: No scheduled sunset, but future lawmakers could still act.
What it means for you: You no longer need to rush to shift wealth before a deadline. But planning still matters—this exemption isn’t unchangeable.
2. The 2017 tax cuts are locked in
OBBBA makes the TCJA’s income tax cuts and standard deduction permanent instead of letting them expire in 2025
Nearly two-thirds of taxpayers—particularly those earning $50K to $100K—will not see sudden tax hikes
The top tax rate stays at 37%, not 39.6%
3. SALT cap goes up—to $40K—for now
The state and local tax deduction is now capped at $40,000 annually, up from $10,000
It’s effective immediately and applies for five years .
Helps mid-to-high-income families in high-tax states—but may phase out above ~$500K income
4. New deductions help primarily middle-income earners
Up to $25K deduction for tips
Up to $12.5K–$25K for overtime pay
Auto loan interest deduction
Seniors (65+) under $75K income: $6K deduction
These expire in 2028. If you’re high net worth, they likely don’t apply to you. But they do matter for younger families and wage earners.
5. Child tax credit is higher—but still phases out for the wealthy
Raised to $2,200–$2,500 (depends on final version), indexed after 2026 .
Gets phased out for higher incomes—likely above $200K/$400K .
If your income is above those limits, this likely won’t apply to you.
6. "Trump Accounts" for kids: $1K starter, up to $5K contributions
Families with children born between 2025–2028 get a $1,000 government seed for a tax-deferred account.
Parents can contribute up to $5,000 annually .
Solid for young families, but limited in scope and timeframe.
7. Business tax breaks improved
100% expensing for equipment and R&D—immediate write-offs .
Enhanced credits for manufacturing and semiconductor investments
Businesses can also benefit from expanded 199A pass-through deductions .
8. Security and planning still matter
The law doesn’t protect against phishing or cyber threats.
And if you run a business, succession plans and retirement readiness remain essential.
Plus, longevity assumptions need review—most people live longer than expected, and plans must adapt.
The bottom line
This bill locks in many favorable tax rules. That’s good news—especially around the $15 million estate exemption. But “permanent” isn’t forever. Governments can change course.
Your advantage? Clarify what matters to your goals. Estate, business, retirement plans—those don’t manage themselves.
If you want peace of mind, it starts with understanding—and then planning with purpose.
Have questions? Schedule a private consultation here.
Sources of Information*:
*These organizations are not affiliated with IFG. IFG does not endorse, support, or recommend any information that is not provided by its affiliates or representatives.
Disclaimer:
Information provided is for informational purposes only, and does not constitute a financial advise, an offer or solicitation to sell, a solicitation of an offer to buy, any security or any other product or service. Accordingly, this document does not constitute investment advice or counsel or solicitation for investment in any security. The information in this material is not intended as tax or legal advice. Please consult legal or tax professionals for specific information regarding your individual situation.
