Caption: Trump addressed the nation from the White House Diplomatic Room Wednesday night.
Since the One Big Beautiful Bill passed on July 4th Big Media has created confusion about when certain provisions started. Did they begin during tax year 2025, which would be realized when one files his/her tax returns early next year, OR, did they begin in tax year 2026? At the November meeting of Peninsula Patriots, the local chapter of the John Birch Society, one attendee insisted that the $6,000 deduction for each Social Security recipient, the cancelation of taxes on tips and the cancelation of taxes on overtime did not begin until January 1, 2026. I argued that he was misinformed, but I was not exactly sure myself. Last night President Trump made it clear:
“Next year, you will also see the results of the largest tax cuts in American history that were really accomplished through our great, big, beautiful bill, perhaps the most sweeping legislation ever passed in Congress, we wrapped 12 different bills up into one beautiful bill that includes no tax on tips, no tax on overtime, and no tax on Social Security for our great seniors.
Under these cuts, many families will be saving between $11,000 and $12,000 a year, and next spring is projected to be the largest tax refund season of all time, because of tariffs, along with the just passed one big, beautiful bill.”
The Epoch Times confirmed that these lower & middle class tax cuts began January 1, 2025, see below, followed by the video from the President’s speech.
President Donald Trump’s “One Big Beautiful Bill” has set in motion one of the most far-reaching overhauls of U.S. tax and social policy in years, with provisions taking effect on staggered timelines that stretch well into the next decade.
Some measures apply immediately or retroactively to income earned this year, while others—particularly changes to health care, federal assistance programs, and student loans—are delayed to allow agencies and states time to adapt administrative systems and implement the new rules.
Provisions Taking Effect in 2025:
At the core of the legislation is the permanent extension of key provisions from the 2017 Tax Cuts and Jobs Act, locking in individual income tax brackets and the expanded standard deduction.
For 2025, the standard deduction is $15,750 for single filers and married individuals filing separately, $31,500 for married couples filing jointly, and $23,625 for heads of household.
Among the most prominent new, temporary tax breaks are deductions that reduce taxable income for tips and overtime, along with an additional deduction for seniors.
Under IRS guidance, qualifying workers may deduct up to $25,000 in qualified tips annually, with the deduction phasing out for taxpayers earning more than $150,000. For overtime, taxpayers may deduct the portion of qualified overtime pay that exceeds their regular rate of pay—such as the “half” portion of time-and-a-half—capped at $12,500 per year ($25,000 for joint filers), also subject to income phaseouts.
The law also creates a temporary senior deduction, allowing eligible taxpayers 65 and older to claim an additional $6,000 deduction for 2025 through 2028, with a phaseout beginning at $75,000 in modified adjusted gross income for single filers.
Beginning in tax year 2025, the legislation also makes up to $5,000 of the adoption credit refundable, indexed to inflation. It further allows taxpayers to deduct interest paid on a loan used to buy a personal vehicle, up to a maximum of $10,000, with the deduction phasing out at incomes more than $100,000.
The law raises the cap on the state and local tax (SALT) deduction from $10,000 to $40,000 beginning in 2025, providing relief to taxpayers in high-tax states. The cap will increase in subsequent years before reverting to $10,000 in 2030.
Major Changes Beginning 2026:
A larger share of the “One Big Beautiful Bill’s” tax-code effects takes hold in 2026. On taxes, updated bracket thresholds and inflation-adjusted parameters take effect for the 2026 tax year, altering withholding and final liabilities for income earned that year.
The IRS said the top 37 percent bracket begins at $640,600 for single filers and $768,700 for married couples filing jointly. The standard deduction rises to $16,100 for single filers and married individuals filing separately, $32,200 for joint filers, and $24,150 for heads of household, with final impacts reflected on returns filed in 2027.
We plan to take our documents to our tax preparer immediately after we receive all our tax documents because we are curious to see the reduction in the amount of taxes the federal government confiscates.
Greedy Democrats Want Biggest Tax Increase In History So Economy Will Tank
Trump 45’s Tax Cuts & Jobs Act of 2017 (TCJA) is designed to expire at the end of this year. If Trump’s One Big Beautiful Bill is not passed, in one form or another, Americans will experience the biggest tax increase in history. Moreover, if these huge tax cuts are not made permanent, the economy will tank, which is what Democrats want.
The author, Diane L. Gruber, is a First Amendment advocate who writes for Substack. She calls her Substack newsletter America First Re-Ignited. Follow me on X @DianeLGruber.
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