Hi all! Long time no write! Anyway I'm back from my "writing slumber" to construct a series of articles on the new tax bill recently passed by Congress and signed by President Donald Trump on July 4, 2025 known as the One Big Beautiful Bill Act, or the OBBA. This bill both continues the cuts of the Tax Cuts and Jobs Act of 2017 (TCJA) and expands them in many cases. Regardless of politics, the one thing this bill IS NOT is a handout to the very rich. While there are a few items the wealthy will love, such as the increase in the deductibility of the State and Local Tax (aka The SALT tax), and the extension and increase in the Uniform Gift and Estate limits, there are other things the very wealthy will NOT like, such as the phaseouts for many features starting at $75,000 for singles and $150,000 for Married Filing Joint filers, and reinstatement of limits on itemized deductions known as "The Pease Limitation."
We'll start off by looking at what benefits everyone. The marginal tax rates will remain at 10, 12, 22, 24, 32, 35, and 37%. This will benefit everyone, because if the Tax Cuts and Jobs Act was allowed to expire after 2025, the marginal rates would have reverted back to 10, 15, 25, 28, 33, 35, 39.6%. This would have increased EVERYONE'S tax bill starting in 2026. Please keep in mind that these brackets are "marginal" brackets, meaning they what you pay on the last dollar you recognize. This is opposed to your "effective" tax rate, which is the percentage of tax you pay on your entire recognized earnings.
Most working people or couples fall in to the 22-24% marginal bracket.
Halas Consulting is a financial services firm specializing in tax prep, tax resolution and tax advisory services. Halas Consulting is located in Pittsburgh's northern suburbs of Ross Township/West View. The firm is owned by Christian Halas
Comments(2)