The 2025 Tax Reform: What You Need to Know to Make Smart Financial Moves
What Is the “One Big Beautiful Tax Bill”?
On July 4, 2025, the U.S. government officially signed into law the One Big Beautiful Tax Bill—a sweeping tax reform that redefines the rules for families, small businesses, investors, and workers across the country.
At RCC, we’re already helping our clients strategically prepare to benefit from this reform while avoiding common pitfalls. Here's everything you need to know.
Key Tax Changes Starting in 2025 and Beyond
1. 📉 Permanent Federal Tax Cuts
The individual tax cuts introduced in 2017 are now permanent. The new income tax brackets are:
2. 💵 No Federal Tax on Tips or Overtime Pay
Service workers will no longer pay federal income taxes on tips.
Hourly workers are now exempt from federal taxes on overtime pay.
🕒 Note: This benefit is temporary and will expire in 2028.
3. 👪 Increased Credits and Family Deductions
Child Tax Credit increased to $2,200 per child, indexed for inflation.
Introduction of a new “Trump Account”: a tax-advantaged family savings account with an annual cap of $5,000 (pending implementation).
The SALT deduction cap (for state and local taxes) is raised to $40,000 per taxpayer.
4. 🏥 Major Changes to Medicaid and SNAP
Medicaid:
Adults ages 19–64 must work at least 80 hours per month to maintain coverage.
Exemptions include adults over 65 and parents of children under 14.
SNAP (Food Assistance):
Healthy adults without dependents must work or train at least 20 hours per week.
⚠️ The Congressional Budget Office estimates that over 5 million people could lose coverage or benefits if they don't meet the new requirements.
5. 🧾 Business Tax Breaks for LLCs and S Corps
The 20% Qualified Business Income (QBI) deduction for pass-through entities remains in effect.
100% bonus depreciation is reinstated and extended—allowing businesses to deduct the full cost of:
Vehicles over 6,000 lbs
Office furniture
Equipment, technology, and property improvements
6. ⚡ Rollback of Clean Energy Incentives
The bill eliminates or phases out many incentives tied to:
Solar panels
Electric vehicles
Energy-efficient appliances and upgrades
📅 Example: The federal credit for new electric vehicles ends in 2028.
7. 🛂 Massive Investment in Border Security
The government will allocate over $170 billion for immigration and border enforcement:
$46.5B for border wall construction
$14B for deportation operations
$45B for ICE detention facilities
Hiring of 10,000 new ICE agents by 2029
8. 📉 Debt Ceiling and Federal Deficit Increase
The bill raises the U.S. debt ceiling by $5 trillion.
The federal deficit is expected to grow by $3.3 trillion over the next 10 years, mainly due to permanent tax cuts.
How Does This Affect You?
If you're a business owner, parent, or independent contractor, this law could either help you save money—or cost you if you're not properly prepared.
Some benefits are automatic, but many require proactive tax planning or must be claimed correctly when filing your taxes.
🛠️ How RCC Can Help You
At RCC, we provide one-on-one expert support to help you:
✅ Review and optimize your business structure (LLC, S Corp, etc.)
✅ Maximize available deductions and credits
✅ Comply with Medicaid and SNAP work requirements
✅ Plan your taxes smartly before 2026
📆 Schedule your consultation today with one of our tax and financial planning experts.
📲 Contact Us
Got questions about how the 2025 tax law affects you?
Call us at (678) 565-1073 or visit our office for an initial consultation.
Prefer to book online? Schedule here
🧠 Final Thought
“The tax system wasn’t written for improvisers. It was written for planners.”
Let RCC help you stay on the right side of the system—and ahead of the curve.