What’s Really Inside Trump’s Sweeping New Tax-and-Spending Bill

Since the past few weeks, we’ve all been watching the whirlwind around President Trump’s ambitious “One Big Beautiful Bill” (OBBB), a sweeping $3.4 trillion fiscal package designed to rewrite tax policy, shake up entitlement spending, and, if you ask the aviation crowd, give a wink to private jet owners. On July 3, the House passed the Senate-approved version in a tight 218–214 vote, sealing a major win for Trump ahead of his self-imposed Independence Day deadline. With only two Republicans, Thomas Massie and Brian Fitzpatrick, breaking ranks, the One Big Beautiful Bill Act (OBBBA) now heads to the White House for a July 4 signature ceremony. This is more than a tax tweak. It’s a full-blown overhaul, and the implications stretch from professionals working in tax and accounting firms to Wall Street, rural hospitals, and college financial aid offices. Let’s unpack which provisions have seen the light of day, and which have been scrapped.

The TCJA Lives On

Think of the OBBBA as TCJA 2.0, but this time with no expiration date. Key provisions from Trump’s 2017 Tax Cuts and Jobs Act are not only extended; they’re enhanced and made permanent. That includes:

• Lower individual rates and bracket reforms
• Larger standard deduction and child tax credit
• 20% QBI deduction (Section 199A) preserved and expanded
• Estate and gift tax exemption locked at $15M (indexed)
• Alternative Minimum Tax (AMT) thresholds held higher

The new standard deduction will rise modestly by $750 for singles ($1,500 joint) in 2025. The child tax credit gets a $200 boost and will adjust for inflation moving forward. But this stability comes at a cost. Invariably, the bill is expected to lead to spending of about $7 trillion a year with inflows of about $5 trillion a year, so the debt, which is now about 6x of the money taken in, 100 percent of GDP, and about $230,000 per American family, will rise over ten years to about 7.5x the money taken in, 130 percent of GDP, and $425,000 per family.

SALT Deduction

The infamous SALT cap gets a makeover, kind of. The $10,000 deduction limit will rise to $40,000 in 2025, increasing slightly each year until it drops back to $10,000 in 2030. But here’s the kicker: this change is temporary, and it still doesn’t help high-income households enough to erase the AMT sting. The good news? PTET (pass-through entity tax) deductions survive intact and untouched, after a nail-biting back-and-forth in early drafts. Thanks to advocacy by the AICPA and industry groups, professionals like accountants, lawyers, and traders remain eligible. As AICPA CEO Mark Koziel put it, “This is a win for millions of businesses, taxpayers, and tax practitioners across the country.”

Tips, Overtime, and Auto Loans

This section could've come from a Trump rally. Four campaign promises made it in:

• No tax on tips
• No tax on overtime
• Interest deduction on auto loans
• $6,000 “senior deduction” (per person, age 65+)

These deductions are above-the-line, don’t require itemizing, and are income-restricted. They apply from 2025 through 2028 and will require updated payroll software and W-2 reporting. Also included: a temporary 100% deduction for qualified production structures and an above-the-line charitable deduction of $1,000 ($2,000 joint).

Corporate & Multinational Tax Rules

Cross-border tax strategies just got a lot less flexible. The OBBBA targets multinational income shifting and erosion through a suite of revisions aimed squarely at base erosion and profit shifting schemes:

• Global Intangible Low-Taxed Income (GILTI): The effective tax rate is raised to 14%, up from the previous minimum rate of 10.5%.
• Foreign-Derived Intangible Income (FDII): The exclusion for deemed returns on tangible assets is repealed, eliminating one of the more generous base-narrowing features for U.S. exporters.
• Base Erosion and Anti-Abuse Tax (BEAT): The BEAT rate jumps from 10% to 10.5%, strengthening IRS efforts to capture earnings stripped out via deductible payments to foreign affiliates.
• Foreign Tax Credit (FTC): The haircut for FTCs under GILTI is reduced, and the allocation rules for expenses related to foreign income are reformed, restricting taxpayers' ability to use domestic expenses to offset foreign earnings.

These adjustments are intended to rebalance the tax code in favor of onshore production and discourage artificial profit shifting to low-tax jurisdictions. For multinational corporations, this will mean restructuring foreign entity chains, reassessing intellectual property placements, and likely increasing their U.S. tax liability.

A $15M Exemption

The estate and gift tax exemption now sits at $15 million per person ($30 million for married couples), with annual inflation indexing and no sunset clause. This is a major departure from the anticipated reversion to roughly $7 million per person, which would have taken effect had the 2017 Tax Cuts and Jobs Act expired as originally scheduled.

• Generation-Skipping Transfer (GST) Tax: The exemption now matches the elevated estate and gift thresholds, giving families a powerful tool to transfer assets across multiple generations without incurring punitive taxation.
• Trust and Estate Income Tax Brackets: The Act retains compressed TCJA-era brackets for irrevocable trusts, but applies annual inflation adjustments, giving fiduciaries more predictability in managing income-producing trust assets.

This opens the door for aggressive but compliant planning: dynasty trusts, spousal lifetime access trusts (SLATs), and charitable split-interest trusts like grantor retained annuity trusts (GRATs) and charitable lead annuity trusts (CLATs) are back in vogue.

R&D, Bonus Depreciation, and the Jet Set

If you’re advising corporations, hold onto your spreadsheets. The bill locks 100% bonus depreciation permanently, a major break for capital-heavy industries, and yes, that includes private jets.

• A $10M jet purchase? That’s a $10M deduction in Year 1.
• R&D amortization? Repealed. Expenses are now fully deductible.
• EBITDA interest deduction limits are back, bad news for highly leveraged firms.

While critics call this “a billionaire’s dream,” the private aviation industry calls it “fuel for sales.” Meanwhile, sustainability-focused businesses are scrambling, as wind, solar, and EV credits start to phase out, ending the $7,500 EV tax credit after September 30.

Hidden Gems in the OBBBA

Trump Savings Accounts: Children born between 2025 and 2028 will receive $1,000 in a federally seeded savings account, with a $5,000 family contribution cap. These accounts are income-restricted.

• 1099-K Threshold Reversal: The bill restores the old reporting threshold, scrapping the $600 rule and easing paperwork for gig workers and casual sellers.
• Expanded 529 Eligibility: Funds from 529 plans can now cover credentials and non-degree training, offering broader educational utility.
• Corporate Giving Floor: Companies must now donate at least 1% of their income to claim charitable deductions.
• IRS Downsizing: Budget cuts may reduce audit activity, especially for high earners, raising concerns over tax enforcement gaps.

These quiet shifts matter, and professionals would do well to keep them on their radar.

What’s in It for Tax Practitioners and Professionals

The OBBBA has major implications for the tax profession. From permanent Qualified Business Income (QBI) deductions to new tax-free income categories, practitioners face both expanded responsibilities and fresh opportunities.

• Expanded Planning Horizons: The permanency of key provisions like the Section 199A deduction, estate tax thresholds, and bonus depreciation allows for more stable long-term planning with fewer what-ifs hanging in the balance.
• More Advisory Opportunities: New deductions for tips, overtime, senior citizens, and auto loan interest mean clients will need help navigating eligibility and documentation.
• Payroll and Software Adjustments: Firms supporting payroll functions will need to adjust systems to track exempt income like tips and overtime, complicating year-end reporting and W-2 preparation.
• Estate, Trust, and Multinational Recalibration: With new estate exemptions and tougher foreign income rules, practitioners who specialize in estate planning or international tax will find plenty of consulting work in the months ahead.

The AICPA praised the bill’s final form, calling it a win for millions of businesses and tax professionals. Their lobbying helped preserve the pass-through entity workaround for the SALT deduction, one of the biggest victories for the profession.

Big Promises, Bigger Price Tag

The OBBBA is more than just a tax reshuffle; it’s a high-stakes $3.4 trillion bet on sustained economic growth, restrained inflation, and long-term fiscal stability. But the numbers paint a more complex picture.

• Revenue Loss: The Joint Committee on Taxation estimates a $4.5 trillion reduction in federal revenue over 10 years.
• Deficit & Debt: With a $5 trillion hike in the federal debt ceiling baked in, the bill delays a default crisis but significantly inflates long-term deficit concerns.
• Offset Measures: These include a 35% cap on charitable deductions, IRA credit reforms, a 0.5% AGI floor on individual giving, higher endowment taxes, and a 1% tax on outbound remittances.
• Inflation & Investor Warnings: The U.S. dollar has dropped 9% year-to-date. Some economists worry the cuts could reignite inflation. Bond expert Jeffrey Gundlach warns the debt trajectory may trigger market unease.

The bottom line? OBBBA rewrites fiscal norms, shifts professional workflows, and gambles on growth to catch up with the giveaways. Over the next decade, debt service alone is expected to balloon from $10 trillion to $18 trillion, doubling annual interest payments from $1 trillion to $2 trillion. That trajectory could force harsh choices: slashing government programs, imposing major tax hikes, or resorting to inflationary money-printing.

The latter would erode the value of U.S. Treasury bonds, bad news not just for investors, but for the entire financial ecosystem that relies on a stable bond market. Without aggressive correction to bring deficits down from 7% of GDP to closer to 3%, economists warn of painful market disruptions and long-term damage to America’s economic foundation.

Time to Sharpen the Pencil

The One Big Beautiful Bill Act has officially landed, and with it, a tidal wave of change for professionals across tax, accounting, and finance. While it delivers some long-sought clarity, like permanent TCJA provisions and PTET protections, it also piles on new responsibilities, especially around compliance, documentation, and year-end planning. Taxpayers may see new deductions and perks, but it’s professionals who will be decoding eligibility, recalculating projections, and managing system updates come Monday. From shifting SALT caps to income-based repayment recalibrations, this bill demands both a deep technical read and a sharp strategic mindset. Whether you're guiding a mom-and-pop shop, a multinational client, or a high-net-worth family, your playbook just got longer. It's not just about preparing returns anymore; it’s about preparing for what’s next. Brace yourself. The future of tax just got a lot more hands-on.