2025 tax law updates + A faith-based perspective on paying taxes

What’s that saying again? “The only thing certain in life is death and…?”

Yep—”taxes.”

And while they’re rarely anyone’s favorite topic, they are important. After all, integrated tax planning is one of the ways we make sure our clients’ Financial LifePlans reflect the full picture of their lives! So, in this article, we’ll share some notable highlights from the newly passed “One Big Beautiful Bill Act” as well as a word of encouragement that just might change the way you view your tax bill. Let’s go!

An update on the markets

Before we dive into tax talk, let’s recap what we’ve seen from the markets over the past few months.

This past spring was pretty challenging, largely due to tariff turmoil. While markets continue to react to ongoing tariff headlines and there’s still more to watch for as deadlines expire, we’re hopeful that the worst of the tariff impact is behind us at this point. That said, stocks have actually had a strong year overall—especially international and emerging market stocks. We’ve also seen bonds and real estate stabilize, which has been an encouraging sign as we wait for what’s next with interest rates.

One of the significant developments this summer was the passage of the “One Big Beautiful Bill Act,” signed into law on July 4.

Overall, it’s unlikely you’ll see a major shift in your tax situation, since the current tax brackets were made permanent rather than reverting to previous levels.

However, the new bill does introduce several notable provisions that might benefit you—though they come with added complexity.

Notable new tax benefits

• An additional standard deduction for seniors (65+) — For the years 2025 through 2028, if you’re 65 or older, you can claim an extra $6,000 (single) or $12,000 (married) on top of the ordinary standard deduction. It starts phasing out if your income exceeds about $75,000 (single) or $150,000 (married).
• Charitable deduction “above the line” — If you don’t itemize your deductions, you can still get a tax break for giving. Individuals can deduct up to $1,000 (and couples up to $2,000) in charitable donations annually, even if you take the standard deduction.
• State and local tax (SALT) deduction cap lifted to $40,000 — The previous $10,000 cap for state/local taxes is now raised to $40,000 for people with income under around $500,000. It begins to phase out above that, so higher earners may see less benefit.
• Estate tax exemption set at $15 million — Beginning in 2026, individuals can leave up to $15 million tax-free ($30 million for married couples) when planning their legacy.
• New tax credit for education scholarships — The bill provides tax credits for donations to scholarship-granting organizations—offering direct dollar-for-dollar credits for supporting private K–12 or religious education, depending on state laws.
• Expanded uses for 529 education savings plans — In addition to college tuition, 529 funds can now be used for private K–12 tuition, vocational training, certification programs, and other approved educational pathways, with higher withdrawal limits (up to $20,000 per year).
• “Trump Accounts” for children without earned income — Starting in mid‑2026, parents can open new IRA-style accounts for kids even if they don’t yet earn income, and contribute up to $5,000 per year, tax-deferred. The funds can be used for education, training, or even a down payment on a home. For children born between 2025-2028, the government will deposit $1,000 at birth.
• An increase in the child tax credit — The credit for children under 17 has gone up slightly to $2,200 per child. It will also adjust with inflation going forward.
• No income tax on tips & overtime — While there are a lot of nuances and qualifications to this provision, the gist is this: From 2025 through 2028, the bill introduces new deductions that effectively remove tips and the portion of overtime pay above your base rate from your taxable income.

We’ve been digging into the bill to help our clients take advantage of its provisions where it makes sense.