The Big Beautiful Bill: What It Means for You and Your Family

The recently passed “One Big Beautiful Bill” (OBBB) has generated plenty of headlines—and even more questions. This sweeping tax and spending bill impacts nearly every American household, including many of our clients here at Carver Financial.

While the legislation brings notable benefits for seniors, it also includes broader tax changes, savings opportunities, and policy updates that could affect your long-term financial strategy. In this post, we’ll walk through the key provisions—and what they could mean for you.

Tax Relief for Seniors (Age 65+)

Let’s start with the good news for retirees and older adults:

1. A New Bonus Deduction

From 2025 through 2028, seniors aged 65 and older can take advantage of a new  $6,000 bonus tax deduction. Married couples where both spouses are 65+ can claim $12,000.

This is in addition to:

• The base standard deduction ($15,750 for individuals / $31,500 for couples filing jointly)
• The existing age-based senior deduction ($2,000 individual / $3,200 per couple)

That means a senior couple could potentially deduct $46,700 before paying any federal income taxes.

2.  Social Security Impact

With these expanded deductions, 88% of Social Security recipients are expected to pay zero federal income tax on their benefits. While Social Security itself isn’t fully tax- exempt, this structure effectively eliminates tax liability for most recipients.

Takeaway: Seniors on a fixed income will likely see more money stay in their pocket.

Benefits for Working Families and Individuals

The OBBB includes a variety of incentives and tax breaks for working Americans:

1.  Overtime, Tips, and Work Incentives

• For households earning less than $150,000/year, tips and overtime pay are now tax-free (up to $25,000 per year).
• Designed to boost take-home pay for hourly and service.

2.  Auto Loan Interest Deduction

• Individuals can now deduct up to $10,000 per year in interest on car loans for vehicles assembled in the U.S. (2025–2028 only).
• Income phaseouts apply above $175,000 (single) or $250,000 (joint).

3. Child & Family Accounts

• Child Tax Credit increases slightly to $2,200 per child, indexed to
• New “Trump Accounts” start with a $1,000 government deposit at birth, growing tax-deferred for education, housing, or retirement.

Changes to State & Local Tax (SALT) Deduction

For those living in high-tax states like New York, California, or Illinois, this is important:

• The SALT deduction cap rises from $10,000 to $40,000 for 2025, with gradual increases thereafter.
• This change especially benefits households making under $500,000 who itemize their deductions.

Healthcare and Medicaid Changes

While many of the bill’s tax cuts are widely praised, it’s important to note that OBBB also includes major cuts to federal programs:

• Medicaid and SNAP (food assistance) face over $1 trillion in funding reductions over the next decade.
• New work requirements and limits on retroactive Medicaid coverage could increase out-of-pocket expenses for some.

529 savings plans

The law expanded the eligible expenses for which 529 funds can be used. Previously, 529 funds for K-12 students could be used primarily for tuition, with an annual limit of $10,000. Expenses such as tutoring, testing fees, dual enrollment, and educational therapy for children with disabilities are now eligible. And the annual amount was increased to $20,000 starting in 2026.

The law also increased student loan payback from $10,000 to $25,000 per beneficiary, allowed for post-secondary credentialing to pursue a trade or designation, and made permanent rollovers from 529 to ABLE accounts.

Other Items to Note:

• Charitable deduction for non-itemizers – Reintroduces the deduction for qualified charitable contributions even for taxpayers who don’t itemize. Effective in tax years following 2025, individuals can deduct up to $1,000 (or $2,000 if married filing jointly). This provision becomes permanent after 2025.

• Gift and Estate exemption thresholds under Tax Cuts and Jobs Act made permanent. The gift and estate tax exemption will also increase from $13.99 million for single filers and $27.98 million for married couples filing jointly in 2025, to $15 million and $30 million, respectively, in 2026.

Will This Help the Economy?

Supporters argue that the bill will:

• Stimulate growth by making tax cuts permanent and encouraging spending and hiring.
• Boost GDP by an estimated 2% over the long run, according to the nonpartisan Tax Foundation.

However, critics note: The bill could increase the national debt over 10 years.

The bottom line? While most Americans will see some form of tax relief, the long-term economic impact remains a subject of debate.

What This Means for You

At Carver Financial Services, our mission is to help you live life on your terms—and navigate through times of change with confidence.

Here’s how we recommend moving forward:

• If you’re over 65, review your tax plan to ensure you’re maximizing the new deductions.
• If you’re working, talk with us about optimizing your paycheck under the new overtime/tips exemption.
• If you itemize, the new SALT cap and auto loan interest deduction may open new opportunities.
• If you have children or grandchildren, consider how Trump Accounts and the Child Tax Credit may help fund their future.

We’re Here to Help

This is a complex and impactful piece of legislation—but you don’t have to navigate it alone. Whether you’re reviewing your retirement strategy, exploring ways to reduce your tax burden, or planning for future generations, our team is here to help you make informed, confident decisions.

As always, we’re committed to providing clarity, perspective, and support through every season of life. Please don’t hesitate to reach out to me or anyone on our team with questions or if we can be of assistance in any way. There’s no cost or obligation to connect—we’re simply here for you.

You can contact us at randy.carver@raymondjames.com or (440) 974-0808.

Any opinions are those of Randy Carver and not necessarily those of Raymond James. This material is being provided for information purposes only and is not a complete description, nor is it a recommendation. The information has been obtained from sources considered to be reliable, but we do not guarantee that the foregoing material is accurate or complete.