• The One Big Beautiful Bill: 5 Things Retirees Need to Know (by Tyler Aubrey)
• Complete Text of the Final Bill (870 Pages)
• The Good, the Bad, and the Ugly in the One Big Beautiful Bill Act

As many are probably aware, on July 4th, 2025, lawmakers passed the “One Big Beautiful Bill Act.”

This extensive 870-page economic package affects nearly every aspect of your financial life, including income taxes, Social Security, Medicare, estate planning, and much more!

While this bill has sparked intense political debate in recent months, I’m not here to share my personal opinions or take any sides. My goal today is to save you from reading 870 pages of Congressional jargon and clearly and objectively outline how this bill affects your hard-earned retirement dollars.

So, to do that, in today’s episode, I’m sharing the 5 biggest things retirement savers need to know about the one big beautiful bill. I’m also sharing a handful of miscellaneous provisions that will apply to a smaller percentage of listeners, but are still interesting, important, and helpful to understand.

There’s good news, bad news, and a few confusing twists that could dramatically affect your financial situation.

So grab some coffee, or something stronger if you need it, and let’s break it all down.

5 Ways the ‘One Big Beautiful Bill’ Impacts Your Retirement

Ok, before we dive into the weeds, I want to share two important notes with you. First, the One Big Beautiful Bill, which I’ll mostly just refer to as the “bill” going forward, identifies some law changes as permanent and others as temporary with specific end dates. Just know that permanent doesn’t necessarily mean permanent, and a change can in fact be made by a future administration and an act of Congress. Second, this bill is massive and is also massively confusing. In fact, there are still many areas of this new legislation that are causing confusion in the planning community and will require additional clarification from the IRS. So, while I’m doing my absolute best to provide accurate information to you today, please note that some interpretations could change, and that you should consult with your trusted advisors before taking any action. Ok, with that out of the way, let’s dive into the 5 biggest things retirement savers need to know about this new bill. First up, the current reduced tax brackets and increased standard deductions have been officially extended. As a refresher, in 2017, the Tax Cuts and Jobs Act (or TCJA), lowered federal income tax rates across the board and increased the standard deduction, among many other things. These tax cuts and increased standard deduction amounts were not permanent and were set to expire at the end of this year unless action was taken. Well, action was taken, and the one big beautiful bill removed the expiration date and permanently extended the current tax brackets and higher standard deduction amounts. In addition, starting this year in 2025, there is a small increase to the base standard deduction. Specifically, if you’re Married Filing Jointly, the standard deduction this year is $31,500, up from $30,000 in 2024. If you’re Single, the standard deduction is half that amount, or $15,750. And we don’t want to leave out those who file as Head of Household – your standard deduction this year is $23,625, up from $22,500 in 2024. Lastly, there is still the additional standard deduction available to individuals aged 65 and older, although the new bill didn’t change or increase the amount. Specifically, those who are married filing jointly can claim the additional standard deduction of $1,600 per spouse who is age 65 or older as of the end of the year. So, $3,200 total if both spouses meet the criteria. For a single filer who is age 65 or older as of the end of the year, the additional standard deduction amount is $2,000. Putting it all together, a couple who is married filing jointly and both aged 65 or older by year-end will be eligible to take the increased standard deduction of $31,500 + the additional standard deduction of $3,200, for a grand total of $34,700. And yes, as some of you might be aware of, there is another “bonus deduction for seniors” that has led to quite a bit of confusion. I’ll address that deduction shortly because it’s somewhat connected to the second major change to share with you—or rather, the absence of change—which is that Social Security will continue to be taxable. To be more accurate (since it is possible for some people to avoid taxes on Social Security), to be more accurate, the One Big Beautiful Bill did not eliminate federal taxes on Social Security benefits as many had hoped. The IRS will continue to use the same formula it has used for the past 40 years to determine how much of your Social Security is taxable, which, depending on your income, can be anywhere from 0% to 85% of your benefit. And, unfortunately, the income thresholds for the Social Security taxability formula have not been adjusted for inflation throughout the entire 40-year period. As discussed on the show before, this lack of an inflation adjustment acts as a sort of phantom or hidden tax that has slowly made more and more Social Security income taxable over the past four decades. Now, while no changes were made to the Social Security taxability formula, the new bill does attempt to make up for this lack of change by introducing what many are referring to as the “Senior Bonus Deduction,” which is the third big item to share with you. Here’s what you need to know. This new “Senior Bonus Deduction” is $6,000 per person ($12,000 for married couples) and is only available to taxpayers aged 65 or older. And contrary to what many people initially thought, this bonus deduction can, in fact, be added to the standard deduction AND the existing additional standard deduction for people aged 65 and older that I spoke about in change #1. In other words, if you are age 65 or older by the end of this year, all three of these deductions can be combined. Even better, this “senior bonus deduction” can be applied whether you take the standard deduction or itemize your deductions. But to keep the math simple, let’s use a married couple filing jointly who is age 65 and taking the standard deduction this year as a quick example. In 2025, they will get the increased standard deduction of $31,500. They will also receive the existing “additional standard deduction”for people aged 65 and older of $3,200. On top of it all, they will also receive the NEW “senior bonus deduction” of $12,000, bring their total deduction amount to $46,700. Unlike the normal standard deduction, this new “senior bonus deduction” is not a permanent feature of the bill and will only be available until 2028. In other words, you have four years to take advantage of this deduction and the planning opportunities it presents. Lastly, before we move on, it’s important to note that this new “senior bonus deduction” does begin to phase out at $150,000 of Modified Adjusted Gross Income for joint filers and $75,000 for single filers. More specifically, it is reduced by 6 cents per dollar over those phase-out limits and is completely eliminated if Modified Adjusted Gross Income exceeds $250,000 for joint filers and $175,000 for single filers. By the way, I know this can be a bit overwhelming, so if you’re having any trouble following along with some of these various deduction amounts and phase-out limits, Tyler Aubrey, lead planner and partner at my firm just published an in-depth, easy-to-read article covering everything discussed today and more. To check it out, just head over to the show notes page for this episode which you can find my following the link in the episode description in your podcast app or by going to youstaywealthy.com/246. Ok, sticking with good news, the fourth big change to share with you is that the SALT Cap has been temporarily increased. As a refresher, the SALT deduction stands for “state and local tax” deduction, and it allows taxpayers to lower their federal taxes by deducting some of the money they paid for state and local taxes, such as property or income taxes. Prior to the Big Beautiful Bill, the SALT deduction was capped at $10,000, which didn’t provide much of a benefit for individuals in high-tax states. But starting in 2025, the SALT deduction cap will temporarily increase to $40,000 for individuals with a Modified Adjusted Gross Income (MAGI) below $500,000. If your Modified Adjusted Gross Income exceeds the $500,000 threshold this year, the SALT deduction will gradually phase out until it is reduced back down to the original $10,000 cap. Specifically, for the tax nerds out there, it is reduced by 30% for every one dollar over the $500,000 MAGI threshold. Lastly, similar to the senior bonus deduction we just discussed, this SALT cap increase is NOT permanent and is set to end after 2029. In 2030, it will revert to the $10,000 cap unless a future Congress takes action. Ok, the 5th change to share with you today, or once again, the absence of one, goes in the unfortunate news column, and that is that contributions to an HSA are still not permitted for Medicare enrollees. And this was a big disappointment because, as some might recall, the House version of the bill did actually propose this long-awaited change to allow individuals on Medicare Part A to continue contributing to Health Savings Accounts (commonly referred to as HSAs). Unfortunately, this provision was removed in the final version of the bill. This means once an individual enrolls in Medicare, they are unable to fund an HSA… even if they’re still working and still covered by an employer’s high-deductible health plan (HDHP). That being said, there is one workaround to share with you…Which is that a working spouse who is not yet eligible for Medicare AND is also covered by a high deductible health plan is actaully eligible to make a FAMILY contribution to an HSA, which is $8,550 in 2025. That person can also make an age 55+ catch-up contribution in the amount of $1,000, but only to an HSA in their name. Catch-up contributions to an HSA for the Medicare-enrolled spouse are not permitted. — Ok, that wraps up the five big changes retirement savers need to know, but before we part ways today, I want to quickly run through a handful of other provisions in the bill that might apply to a smaller percentage of our listeners, but are still important to know about. The first is a permanent extension of the increased lifetime estate and gift tax exemption amounts. As a refresher, starting in 2018, the Tax Cuts and Jobs Act doubled the lifetime exemption for estate and gift taxes compared to previous years. However, this increase was temporary and set to revert back to the original levels in 2026 unless action was taken. Well, action was taken as part of the one big beautiful bill, permanently extending the higher exemption levels. Additionally, starting next year in 2026, there will be another small increase to the exemption amount. For context, the current lifetime estate exemption in 2025 is $13.99 million dollars per person and would normally increase with inflation each year. So, under normal circumstances, we’d expect the 2026 exemption to jump to somewhere around $14.5 million as a result of an inflation adjustment. However, as a result of the one big beautiful bill, starting in 2026, the lifetime exemption will increase to a flat $15 million per person, which will then continue adjusting upward each subsequent year based on inflation. And again, this increase to the lifetime estate and gift tax exclusion was made permanent, with no end date. Next, the existing mortgage interest deduction amounts were extended and have now been made permanent. More specifically, if you have a mortgage on a first and/or second home and itemize your deductions, the mortgage interest deduction remains limited to a principal amount of $750,000. In other words, any interest paid on a principal mortgage balance that exceeds the $750,000 threshold is now permanently non-deductible. The next change to quickly share is a permanent additional deduction for charitable contributions for taxpayers taking the standard deduction. Historically, charitable contributions were only deductible for those who itemized on their tax return. But starting next year, in 2026, a married couple filing jointly can claim a deduction for up to $2,000 of charitable donations and a single tax filer can claim $1,000. There are no income phase-outs which is great, but there are also no inflation increases, which will reduce the benefit of this welcomed change over time. Sticking with charitable giving, if you itemize your deductions, the new bill also changed how much of your charitable donations can be itemized. Specifically, starting in 2026, your itemized charitable contributions must exceed 0.50% of your Adjusted Gross Income to become deductible. For example, let’s say your adjusted gross income in 2026 is $200,000 and you donate $1,000 to charity. Well, $200,000 x 0.5% is $1,000. So, according to his new tax rule, you would not be able to itemize and deduct your $1,000 donation since it doesn’t exceed 0.5% of your adjusted gross income. As nother example, let’s say you have the smae $200,000 of income but you donate $2,000. In that scenario, you would only be able to itemize and deduct $1,000, the amount above 0.5% of your adjusted gross income. Ok, second to last change to share is the temporary deduction of car loan interest. This is effective starting this year in 2025, and goes through 2028, so you have four years to take advantage. In short, up to $10,000 of interest on car loans can be deducted from your income. However, this deduction only applies to new, personal-use (non-business) cars that are assembled in the US, and lease financing is not eligible. The deduction is also subject to a phase-out of 20% for every dollar above a Modified Adjusted Gross Income of $200,000 for married individuals filing jointly and $100,000 for Single Filers. This phase-out means that the deduction is reduced to zero if income reaches $250,000 or more for married couples filing jointly, and $150,000 or more for single filers. Last but not least, I want to quickly touch on the wildly confusing Trump “savings accounts.” While more clarification from the IRS is still needed, in short, these “Trump Accounts” are essentially Traditional IRAs used to accumulate retirement savings for minors. The investments in the account grow tax-deferred (like an IRA)and are taxed as ordinary income when money is withdrawn at age 18 or older. Annual contributions, which are not permitted to begin until July 4th, 2026, are capped at $5,000 per year until the child reaches the age of 18. The government will also be making federal-funded $1,000 contributions each year to accounts in the name of US children born between 2025 and 2028. Children born before 2025 are still eligible for the account, but do not receive the federally funded contribution of $1,000 each year. Although well-intentioned, this new savings account has significant drawbacks. For example, contributions are not tax-deductible, and distributions, as mentioned, are taxed as ordinary income, as opposed to the often more favorable long-term capital gains rates. Still more to learn about these accounts, but on the surface, many of us planners are scratching our head trying to uncover how beneficial they really are. As you can tell, there is a lot to unpack in this bill—a bill that emerges during a time when it’s challenging to find clear, objective information without politics muddying the picture. The reality is that ugly politics has been a prevalent theme throughout history, and we can either make educated and informed decisions in response to law changes, or we can get caught up in the noise that’s hammering our eardrums and eyeballs at every turn. Personally, I suggest the former and recommend focusing on what you can control and working with your trusted advisors to understand exactly how these changes impact your retirement plan and how you can take advantage of new opportunities. If you have any questions as you digest everything or think I missed something critical that our listeners need to know or you think I got something wrong, please don’t hesitate to send me an email at podcast at youstaywealthy.com. To view the research and articles supporting today’s episode—including the entire 870 page bill and an in-depth article written by lead planner and partner of my firm, Tyler Aubrey—, just head over to youstaywealthy.com/246.