The 2025 tax bill introduces sweeping updates that directly impact high-income families, business owners, and those with substantial incomes. While some provisions extend existing benefits, others create time-sensitive planning opportunities. Understanding these changes is essential but knowing how to respond is even more important.
At BentOak Capital, we help clients cut through the noise and apply what matters. Below is a practical guide to what’s changed, what it could mean for your wealth, and how we can help you take the next step with clarity.
Estate and Gift Tax Updates in the 2025 Tax Bill
The federal estate and gift tax exemption has increased to $15 million per person. For married couples, this means up to $30 million can be passed to heirs without triggering federal estate tax.
This higher exemption offers a significant opportunity to transfer wealth efficiently. If your estate planning documents haven’t been updated recently, this is the time to review them. You may also want to evaluate how portability rules, which allow a surviving spouse to claim any unused exemption, fit into your broader legacy goals.
Because tax laws can shift with changing administrations, a proactive estate strategy is one of the most effective ways to preserve multigenerational wealth.
Income Tax Rate Extensions and Why They Matter
The 2025 tax bill makes permanent the lower income tax rates originally introduced in the 2017 Tax Cuts and Jobs Act. Those rates were set to expire in 2026, which would have resulted in higher taxes for many high earners.
With this change, individuals and families with significant income from wages, investments, or business distributions may see meaningful tax savings in the coming years. Now is a good time to assess whether your income structure is optimized under the extended rate system.
SALT Deduction Cap Raised Through 2029
For married couples filing jointly, the cap on state and local tax (SALT) deductions has been raised to $40,000 through 2029. In 2030, it will revert to the prior $10,000 limit.
While this is a welcome change for some, others may still find that itemized deductions fall below the threshold. If so, a more effective strategy may be to use Qualified Charitable Distributions (QCDs). These allow individuals to donate up to $100,000 per year, per person, directly from an IRA to qualified charities without increasing taxable income.
For many high earners, QCDs can reduce both income and future estate taxes while supporting meaningful causes.
Business Owner Considerations Under the 2025 Tax Bill
The 2025 tax bill permanently extends the Qualified Business Income (QBI) deduction, which allows eligible owners of pass-through businesses to deduct up to 20 percent of their qualified income.
If you’re still receiving income from a business, either actively or passively, it’s worth reviewing how your earnings are categorized and whether you’re positioned to take full advantage of this deduction. This is also a good time to reexamine your entity structure to ensure it still aligns with your long-term goals.
Changes to Itemized Deductions and Charitable Giving
The new tax law introduces tighter limits on itemized deductions for high earners. For example, charitable contributions must now exceed 0.5 percent of your adjusted gross income to be deductible.
With the standard deduction remaining high, and SALT deductions capped, itemizing may no longer make sense for some families. That’s another reason QCDs are gaining traction. They allow you to make impactful gifts while reducing income and without needing to itemize at all.
For retirees receiving Social Security benefits, QCDs may offer an added advantage. Because QCDs reduce your adjusted gross income, they may also lower the portion of Social Security that is subject to income tax. This can help preserve more after-tax retirement income while continuing to support charitable causes.
Other Key Provisions to Know
- Alternative Minimum Tax (AMT): Higher exemption thresholds reduce exposure for many high-income households.Â
- Deductions for Seniors: An additional deduction is available for individuals over 65, though income limitations apply.Â
- Temporary Deductions: Select income sources, such as tip income and U.S.-manufactured vehicle loan interest, may be deductible for a limited time. These changes likely won’t affect most high earners, but they’re worth noting.Â
Each of these provisions interacts differently depending on your income sources, business interests, charitable goals, and estate plan.
Want a Broader Perspective?Â
If you’re interested in how the new legislation fits into the larger economic picture, including national debt, government spending, and market trends, check out our full commentary.
Planning with Purpose
The 2025 tax bill creates opportunity, but also complexity. High earners and families with significant assets need a clear plan that goes beyond compliance. It’s not just about reacting to new tax rules. It’s about integrating them into a larger strategy that reflects your values, priorities, and long-term vision.
At BentOak Capital, we specialize in helping clients do exactly that. We simplify the complex and guide you through every decision with clarity and purpose.
Want to understand how the 2025 tax bill affects your personal situation? Request a Retirement First Look or schedule time with a BentOak advisor.
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