One Big Beautiful Bill at a Glance: What to Know

Tax policy matters for retirees, especially when new legislation like the Big Beautiful Bill becomes law. Although some provisions are still being clarified, many retirees may benefit from understanding how recent changes could connect with their finances.

Income Tax Brackets

One key element of the Big Beautiful Bill is making certain tax cuts from the 2017 Tax Cuts and Jobs Act permanent, including income tax brackets. According to Baker Tilly, these adjustments mean that most tax brackets will remain as they are, while certain thresholds change under inflation adjustments.¹ For retirees with income from multiple sources, this may influence what tax rate applies to portions of income.

Gains and Deductions

Another part of the law relates to investment earnings and deductions. Lowenstein Sandler LLP reports changes to the Qualified Small Business Stock (QSBS) rules, which affect how gains from certain business equity are treated.² Also, changes to state/local tax (SALT) deduction rules and other itemized deductions are part of the conversation. These modifications may affect retirees who have investment income or who itemize deductions.

Estate and Gift Tax Provisions

The Big Beautiful Bill includes updates to estate and gift tax exemptions. As Porzio, Bromberg & Newman describe, the exemption will increase to $15 million per individual, and the law makes several changes designed to affect how estates are taxed going forward.³ For retirees considering legacy planning, these updates may seem particularly relevant.

Next steps

Rules like these remind us that changes in Washington can connect directly with retirement finances. For retirees, staying aware of adjustments to tax brackets, investment gain rules, and estate exemptions may help with transparency of tax exposure and planning.

At Financial Services of America, our focus is helping clients see how legislative updates fit into a broader financial strategy. We do not advise making decisions based solely on proposals, but do encourage understanding how current law may affect your situation.

No matter where you are in your financial journey, we are here to help you chart the ideal path forward. Let’s start building the ideal financial plan for your very own goals.