Trump’s Big Tax Bill Highlights

On July 4, 2025, President Trump signed his big new tax bill into law after both the House and Senate had passed the bill previously.  There are a number of tax provisions in the new tax law and the following are some of the highlights of the new tax law:

• The new law increases the Schedule A deduction for state and local property and income taxes from $10,000 to $40,000. The amount is phased out for taxpayers with $500,000 of income or more.  This becomes effective for the tax year 2025.
• Beginning in 2026, individuals who have made charitable donations will be allowed to deduct $1,000 for single individuals and $2,000 for married couples filing jointly even if they do not itemize their deductions on Schedule A.
• In addition, a married couple who make charitable donations and itemize their deductions will face a deduction of their charitable donations equal to 0.5% of their modified adjusted gross income. This means that an individual with $400,000 of modified adjusted gross income would get no deduction for the first $2,000 of charitable donations made on their Schedule A of their 1040.
• The no tax on overtime provision allows a deduction up to $12,500 for single individuals with income up to $150,000 and $25,000 for married couples who file jointly with income up to $300,000 for qualified overtime pay.
• The no tax on tips provision allows for a deduction up to $25,000 for single individuals with income up to $150,000 and $25,000 for married couples who file jointly with income up to $300,000. This would be phased out for individuals with income over those respective amounts.
• The no tax on Social Security item provides for a $6,000 extra deduction per person age 65 or older for single individuals with income up to $75,000, and for a married couple filing jointly, with up to $150,000 of income. This also has phase out provisions.
• The current federal estate tax exemption is $13,990,000 and was scheduled to be reduced to slightly below $7,000,000 in 2026. However, the new bill increases the estate tax exemption to $15,000,000 beginning in 2026 and increases that number with inflation in years thereafter.
• The individual income tax rates remain the same as they have been: 10%, 12%, 22%, 24%, 32%, 35%, and 37%.
• The standard deduction for 2025 will be $15,750 for single individuals and $31,500 for married couples filing jointly.

Please make sure to work with your CPA, financial planner, and estate planning attorney regarding any planning matters which could be utilized as a result of Trump’s new tax bill which became law.

NOTE: This general summary of the law should not be used to solve individual problems since slight changes in the fact situation may require a material variance in the applicable legal advice.

James F. Contini II, Esq.
Certified Specialist in Estate Planning, Trust & Probate Law by the OSBA
Krugliak, Wilkins, Griffiths & Dougherty Co., LPA
405 Chauncey Avenue NW
New Philadelphia, Ohio 44663
Phone:  (330) 364-3472
Fax:  (330) 602-3187
Email:  jcontini@kwgd.com