President Donald Trump recently signed into law the “One Big Beautiful Bill Act,” which reshapes certain tax deductions, credits, and exemptions for individuals, families, and business owners. This measure marks a significant milestone for U.S. tax law, shifting several key thresholds that directly impact family finances and long-term planning.
Sorting through the language of the bill will take time, especially for those who aren’t as connected or in tune with the law. At Dahl Law Group, our team of tax lawyers and professionals is already on top of the bill and incorporating changes into the work we do. The following is not an exhaustive list of the changes, as we will cover some changes over the course of several articles, but rather a capture of some of the immediate and important changes to be aware of. Ultimately, our role isn’t to debate the overall impact of the law but to implement it in ways that are beneficial to California business owners and their families.
Extending the Estate Tax and Gift Exemption
High-net-worth families have benefited from elevated estate and gift tax exemptions since the 2017 changes in Trump’s first term. The new law builds on that structure, increasing the 2025 exemption from $13.99 million to $15 million for individuals and from $27.98 million to $30 million for married couples beginning in 2026. These figures create more flexibility for lifetime transfers and inheritance strategies, particularly for those whose businesses represent a significant portion of their estate. Owners can take advantage of this higher threshold to plan gifts or restructure holdings without triggering additional tax burdens.
Expanding Qualified Small Business Stock Benefits
The new law also notably enhances the benefits of Qualified Small Business Stock (QSBS) under Section 1202 by raising the capital gain exclusion limit. The exclusion now begins at $15 million (up from the prior $10 million) with future adjustments tied to inflation starting in 2026.
This higher floor allows founders, employees, and early investors to shield a greater portion of their gains when selling qualifying stock. The Act also introduces partial exclusions for sales made after three or four years, creating more flexibility for those unable to meet the traditional five-year holding period. Coupled with relaxed eligibility standards for qualifying stock, more small businesses can now issue QSBS and attract capital under the new rules. For California entrepreneurs and investors, this change could play a pivotal role in long-term planning and exit strategies.
Increased Standard, Bonus, and Other Deductions
Several deductions rise under the new law, which can offer expanded relief to a broad range of taxpayers. The standard deduction moves from $15,000 to $15,750 for single filers and from $30,000 to $31,500 for married couples. Older adults will also see a dramatic shift within the ‘bonus’ deduction, with that number jumping to $7,600 for those 65 and older and $8,000 for unmarried individuals or those not classified as surviving spouses, applicable from 2025 through 2028.
The state and local tax (SALT) deduction cap increases from $10,000 to $40,000 in 2025, followed by incremental annual increases until 2029, after which it reverts to $10,000 in 2030. For California residents and other taxpayers in high-tax states, this presents a notable opportunity to optimize deductions.
Another notable change is the return of a charitable deduction for non-itemizers, set at $1,000 for individuals and $2,000 for married couples, effective in 2025. This means you can deduct charitable contributions even if you are not itemizing your return up to $1,000 per individual.
Tax Credits for Parents
Parents gain additional support through modest changes to the Child Tax Credit, which increases from $2,000 to $2,200 per child. The refundable portion remains $1,700, but future years will include adjustments for inflation. A new benefit, referred to as “Trump Accounts,” adds a one-time $1,000 credit for each child born between 2025 and 2028. This credit is designed to help families establish early savings for future expenses such as education or healthcare.
Income and Paycheck Tax Changes
Two new deductions target income earned through tips and overtime. Workers can deduct up to $25,000 annually from tips and up to $12,500 annually from overtime pay from 2025 through 2028. There are phase outs due to those earning higher income, but these provisions could significantly impact taxpayers in industries like hospitality, retail, and construction, where variable income is common.
Get the Most Out of Your Taxes with the Right Tax Strategy
The Trump administration’s new tax bill introduces several complex changes to American tax law. We will see ripple effects for families and businesses, for estate plans, home finances, purchase decisions, succession goals, and more.
Evaluating these updates now will help position your assets and finances for both short- and long-term benefits. Our team understands the intersection of tax strategy, business ownership, and family wealth planning. Contact Dahl Law Group to protect your business, align your estate plan, and make these changes work for your future.
Dahl Law Group
Latest posts by Dahl Law Group (see all)
- How California’s Single-Enterprise Rule Impacts Your Business - April 24, 2026
