Latest news with #TCJA
Forbes
a day ago
- Business
- Forbes
One Big Beautiful Bill Act Changes Form 1099 Reporting For Gig Workers And Those Who Use Payment Apps Like PayPal For Business
Gig workers will see a change in reporting. getty The One Big Beautiful Bill Act (OBBBA) was signed into law by President Donald Trump on Thursday, July 4, 2025. The new law makes permanent several of the expiring tax cuts contained in Trump's signature 2017 tax legislation—the Tax Cuts and Jobs Act (TCJA). It also changes those controversial reporting requirements for gig workers and those who use payment apps like PayPal for business. That includes the reporting thresholds for Form 1099-K (for payment card and third-party network transactions), Form 1099-MISC (for payments not covered by other 1099 forms), and Form 1099-NEC (for nonemployee compensation)—those have been changed. Under OBBBA, there are changes to the reporting thresholds for Form 1099-K (for payment card and third-party network transactions), Form 1099-MISC (for payments not covered by other 1099 forms), and Form 1099-NEC (for nonemployee compensation). Form 1099-K is used to report payments received for goods or services that are processed through payment apps (like PayPal and Zelle), online marketplaces (like eBay), and, of course, credit cards. The old reporting threshold for Form 1099-K (you can read more about that below) is now new again. OBBBA reinstates the $20,000 and 200 transactions thresholds, retroactive to 2022 (or as if the reporting changes American Rescue Plan Act of 2021 had never happened). That means that the $20,000 and 200 transactions thresholds will apply to the tax year 2025. Form 1099-MISC is used to report non-wage income like attorney payments, royalties, prizes and awards, and some rents. The reporting threshold for Form 1099-MISC will increase from $600 to $2,000, effective as of the 2026 tax year (the forms you'll receive in 2027). For tax years beginning in 2027 and after, the threshold will be adjusted for inflation. Form 1099-NEC is used to report non-employee income—those for independent contractors and gig workers. The reporting threshold for Form 1099-NEC will increase from $600 to $2,000, effective as of the 2026 tax year (the forms you'll receive in 2027). For tax years beginning in 2027 and after, the threshold will be adjusted for inflation. What Taxpayers Need To Know About Form 1099 The changes under OBBBA should mean fewer forms for taxpayers. In 2023, the IRS estimated that up to 44 million Forms 1099-K would be sent to taxpayers. (The official IRS projections, released in September 2024, suggested that the numbers were much smaller due to the delayed implementation of the $600 reporting threshold.) The U.S. Bureau of Labor Statistics reports that the number of self-employed individuals is around 16.5 million, representing approximately 10.4% of the total workforce. That doesn't necessarily translate into 16.5 million Forms 1099-NEC since some self-employed workers don't receive any forms, while others may receive multiple forms. But it's clear that changing the reporting threshold will impact millions of taxpayers. Regardless of the reporting threshold, all taxable income, including income earned through payment apps and online marketplaces, and income earned from side gigs and contracting jobs, must be reported on your tax return. Background For years, taxpayers who provided certain goods or services worth more than $600 were required to issue Form 1099-MISC. That changed slightly in 2012 with the new Form 1099-K. Form 1099-K introduced a requirement for reporting payment transactions, defined as transactions made with a payment card or through a third-party network. Payment card transactions include accepting a card—such as a gift card, credit card, or debit card—for goods or services. A third-party network transaction is one that is settled through a third-party payment network, such as PayPal. For the most part, think payment apps or online marketplaces. While the reporting threshold for Form 1099-MISC had been $600, Form 1099-K required reporting when payments totaled more than $20,000 and more than 200 transactions were settled through a third-party network. No threshold applies to payment card transactions, which include credit, debit, or stored value cards, such as gift cards. The gap between the "old" Form 1099-MISC reporting threshold of $600 and the Form 1099-K reporting threshold of $20,000 was a cause for concern for some who worried about a lack of reporting compliance. The fix from Congress in 2021 was a lower $600 threshold amount for Form 1099-K set to take effect in the 2022 tax year, meaning forms that would be distributed in early 2023. However, under pressure from business groups and an IRS that wasn't yet prepared to deal with the volume, 2022, 2023, 2024, and 2025 were treated as transitional years. For the 2025 tax year, the IRS had signaled that third-party networks, such as payment apps and online marketplaces, would issue Form 1099-K if the aggregate payments received by a payee exceeded $2,500, regardless of the number of transactions. That was a step towards the $600 threshold created under the American Rescue Plan Act of 2021 and was slated to take effect in 2026. (No threshold applies to payment card transactions—payment cards encompass credit, debit, or stored value cards, such as gift cards.) Starting in 2020, there was another change to Form 1099-MISC. The IRS brought back Form 1099-NEC, Nonemployee Compensation, to report payments of nonemployee compensation (NEC) previously reported in box 7 on Form 1099-MISC. That means that independent contractors and gig workers now receive Form 1099-NEC, not Form 1099-MISC. Form 1099-MISC is still used to report attorney payments, royalties, prizes and awards, and some rents. The reporting thresholds for both forms had been $600. (The $600 threshold has never been adjusted for inflation. However, if cost-of-living adjustments had been made each year since 1954—the year that section 6041 of the tax code was introduced—the $600 threshold would now be over $7,170.) Why Were The Form 1099-K Requirements Changed In The First Place? The change in reporting threshold for the Form 1099-K originally was increased compliance. According to the IRS, tax gap studies have consistently demonstrated that third-party income reporting significantly raises voluntary compliance with tax laws. For example, computerized document matching in the early 1980s—where the IRS matched data reported by third-party financial institutions to data reported by taxpayers—significantly reduced underreporting of dividend and interest income. And the 1987 requirement that taxpayers supply Social Security numbers for dependent children resulted in a marked difference in the numbers of dependents claimed on returns—seven million fewer dependent children were claimed than in the previous year. Forbes IRS Issues Guidance On New Deductions For Seniors, Tips, Overtime And Car Interest By Kelly Phillips Erb Forbes Questions About The New Tax Bill? Taxgirl Has Answers By Kelly Phillips Erb Forbes What The One Big Beautiful Bill Act Will Mean For You And Your Business By Kelly Phillips Erb
Yahoo
2 days ago
- Business
- Yahoo
3 Tax Breaks That Will Change This Year Because of the 'Big, Beautiful Bill'
KEY TAKEAWAYS The 'Big, Beautiful Bill' increases some major tax deductions for the 2025 tax year, but also ends other credits. The bill raises the standard deduction by $750 to $1,125 for taxpayers who don't itemize their 2025 taxes. Taxpayers who do itemize can deduct four times more of what they paid in state and local taxes than in previous years. The bill eliminates energy credits for clean vehicles and clean home tax bill will look different this year thanks to the 'Big, Beautiful Bill' President Trump signed the into law this month. The law extends and expands the Tax Cuts and Jobs Act (TCJA) that Trump enacted in 2018 during his first term. Some tax credits and deductions from this act will increase during the 2025 tax year, but other clean energy credits will be eliminated. Tax credits are the amount of money taxpayers can subtract directly from the taxes they owe. Tax deductions are how much taxpayers can subtract from their taxable income, to lower the overall amount of taxes they owe. These are the most significant tax credit and deduction changes in the 'Big, Beautiful Bill' that will apply to next year's 2025 tax returns. The Standard Deduction Will Increase The 'Big, Beautiful Bill' permanently increases the standard deduction, a fixed amount that taxpayers who do not itemize their deductions can subtract from their taxable income. Under the bill, the standard deduction for single taxpayers and married individuals filing separately increases by $750 for the 2025 tax year. It will also increase by $1,125 for heads of households and by $1,500 for married couples filing jointly. Standard deductions will continue to rise annually to keep in line with inflation increases. The Increased 2025 Standard Deduction Under The 'Big, Beautiful Bill' Single Taxpayers and Married Filing Separately Heads of Households Married Filing Jointly $15,750 $23,625 $31,500 SALT Deduction Expands The final bill temporarily increases the state and local tax (SALT) deduction. This deduction allows taxpayers who itemize their taxes to subtract all or some of what they paid in taxes to their state and local governments from their federal taxable income. The 'Big, Beautiful Bill' quadruples the original $10,000 cap that the TCJA put on SALT deductions to $40,000 for the 2025 tax year. That means taxpayers, specifically those with higher incomes or in high-tax states, can deduct more when they file their 2025 taxes next year. The bill also increases the cap every year to keep pace with inflation and wage growth. From 2026 to 2029, the cap will increase 1% annually until 2030, when the provision expires. The Cap On SALT Deductions Increases By 1% Every Year 2025 2025 2027 2028 2029 $40,000 $40,400 $40,804 $41,212 $41,624 The bill also establishes an income threshold for SALT deductions that increases by 1% every year. Beginning with the 2025 tax year, taxpayers who have an annual Modified Adjusted Gross Income of $500,000 or more will be phased out of the SALT deduction until their MAGI reaches $633,333 or more, at which point they cannot claim the deduction at all. Clean Energy Credits End The bill terminates several tax credits and rebates that Americans can use to purchase clean energy vehicles and clean home energy solutions. However, taxpayers still have some time to take advantage of these credits. Both the $4,000 used clean vehicle and $7,500 new clean vehicle credit expire on Sept. 30, 2025. That gives taxpayers less than two months to purchase a clean vehicle and claim a credit credit when they file their 2025 taxes next year. The Residential Clean Energy Credit, which equals 30% of the cost to install new clean energy home improvements, ends on Dec. 31, 2025. Taxpayers who want to claim this credit must have these systems installed and connected before the year ends. Read the original article on Investopedia
USA Today
2 days ago
- Automotive
- USA Today
'One Big Beautiful Bill' offers Americans lots of tax benefits. Here are a few to plan for
Tax season isn't close to opening yet, but now is the time to start planning to take advantage of new provisions in the massive tax and spending bill that became law earlier in July, experts say. No tax on tips and overtime and the $6,000 bonus deduction for seniors have been well publicized, but there's much more that can change your taxes. Other highlights include charitable contributions deductions, auto loan interest deduction for certain new vehicles and increased deductions and credits for families. 'Everyday taxpayers who received the standard deduction had no tax planning opportunities under the 2017 TCJA (Tax Cuts and Jobs Act),' said Brian Gray, certified public accountant and tax partner at Gursey Schneide. Now, there are many. Charitable contributions are no longer just for itemizers OBBB permanently brings back a charitable contributions deduction for those who take the standard deduction beginning in 2026. During the pandemic in 2020, the CARES Act allowed a temporary deduction of up to $300 for cash donations for individuals taking the standard deduction. The temporary deduction was extended and expanded to $600 for married couples filing jointly for 2021 and then expired. Under OBBB, 'year-end charitable deduction planning could be beneficial,' Gray said. 'You can deduct $1,000 per person, or $2,000 per couple, in above-the-line charitable contribution deductions if you cannot itemize.' An above-the-line deduction can be taken without itemizing. It's valuable because it lowers your adjusted gross income, which lowers your tax liability and may help you qualify for other deductions or tax credits. Interest deduction on personal auto loans OBBB has made new personal auto loan interest deductible for non-itemizers for the first time ever, said Brian Schultz, certified public accountant in Plante Moran Wealth Management's tax practice. Personal auto loan interest used to be deductible but only as an itemized deduction until the Tax Reform Act of 1986 eliminated it. Under OBBB, Americans can deduct up to $10,000 of interest on their taxes, beginning in 2025 through 2028. There are specific requirements to qualify for the deduction that could make it harder to take advantage of, some warn. For example, the purchase must be a new, U.S.-assembled vehicle for personal use, and income limitations apply. However, if you can find a qualified car and are eligible for the deduction, the calculus could change when deciding whether to buy or lease a car and how much each cost, Schultz said. More benefits for families There are two benefits families should be aware of even if they take the standard deduction, Schultz said. The OBBB permanently increases the annual maximum contribution to $7,500 (or $3,750 for married couples filing separately) from $5,000. Though the increase begins next year, enrollment in these plans starts soon in 2025, Schultz said. Other than a temporary increase during COVID to $10,500, (or $5,250 for married individuals filing separately) in 2021 from the American Rescue Plan Act, the contribution level had been stuck at $5,000 for 40 years, according to insurance brokerage Newfront. First, the credit rate increased to 50% from 35% of qualifying expenses, up to $3,000 for one child and up to $6,000 for two or more children, for families with the lowest incomes. There isn't an income ceiling, but the percentage gradually decreases as income rises. Second, the way the new credit rate phases down for taxpayers, the income threshold to receive the lowest 20% credit has jumped to $206,000 for a married couple filing jointly and $103,000 for individuals from pre-OBBB income levels of $86,000 and $43,000, respectively. These changes will result in nearly 4 million families seeing an increased tax credit, according to First Five Years Fund, a nonprofit focused on ensuring families have affordable access to quality child care and early learning programs. 'Under current law, a family with two young children making less than $150,000 typically receives around $1,200,' said Sarah Rittling, the organization's executive director, in a statement after Congress passed the OBBB. With the 'enhancements, that benefit would see a $900 boost that can make a meaningful difference for parents managing tight budgets.' With some planning, Americans may also be able to score a larger credit, Schulz said. For example, boosting a 401(k) contribution could reduce your taxable income enough to pick up a larger CDCC in 2026. 'A lot of new changes with income phaseouts,' he said. 'Be mindful of income levels.' Medora Lee is a money, markets, and personal finance reporter at USA TODAY. You can reach her at mjlee@ and subscribe to our free Daily Money newsletter for personal finance tips and business news every Monday through Friday.
Forbes
2 days ago
- Business
- Forbes
One Big Tax Break: The Top 5 Business Cuts In The Big Beautiful Bill
WASHINGTON, DC - JULY 04: U.S. President Donald Trump, joined by Republican lawmakers, signs the ... More One, Big Beautiful Bill Act into law on the South Lawn of the White House in Washington, DC. (Photo by) On July 4, 2025, President Donald Trump signed into law what he has called the biggest tax cut in U.S. history—the 'One Big Beautiful Bill Act' (OBBBA). The act is poised to serve as a comprehensive effort to stimulate economic growth, minimize regulatory burdens, and foster greater benefits for entrepreneurs. The Bill introduces a range of tax changes benefiting both individuals and business owners. While the legislation is broad in scope, and extends beyond tax matters, one of its key features is the slate of tax cuts targeted at American businesses, particularly those in the small and growing category. These elements are designed to reduce tax liabilities and encourage capital investment for business owners navigating a challenging post-pandemic economy. Let's take a closer look at the top five business tax cuts in the OBBBA and what they could mean for entrepreneurs in 2025 and beyond. Permanent Extension of the Qualified Business Income Deduction The Act makes a major, permanent change to the tax code by securing the Section 199A pass-through deduction—commonly known as the Qualified Business Income (QBI) deduction—as a permanent feature of U.S. tax law. Originally introduced under the Tax Cuts and Jobs Act (TCJA) of 2017 during President Trump's first term, the QBI deduction allows eligible owners of pass-through entities—such as sole proprietorships, partnerships, S corporations, and certain trusts and estates—to deduct up to 20% of their qualified business income from taxable income. The deduction was a significant tax benefit designed to level the playing field between pass-through businesses and C corporations, which had received a substantial corporate tax rate cut under the same legislation. Under the original TCJA, however, the QBI deduction was scheduled to sunset at the end of 2025, creating uncertainty for millions of small business owners and entrepreneurs who relied on the deduction to reduce their effective tax rate. The expiration would have effectively raised taxes on pass-through businesses, many of which are the backbone of the American economy. By making the QBI deduction permanent, the OBBBA eliminates that looming uncertainty and ensures long-term tax stability for a wide range of businesses. In addition to making the deduction permanent, the OBBBA also raises the income thresholds at which the deduction begins to phase out. Joint filers with taxable income up to $494,600 are now eligible to claim the full deduction, an increase of more than $10,000 over previous limits. This change expands access to higher-earning business owners who were previously limited or excluded from the deduction. Notably, these expanded thresholds will be indexed to inflation beginning in 2026, helping the deduction maintain its value and reach over time. The Act also introduces a minimum deduction safeguard for the smallest businesses. Under the new provision, businesses with at least $1,000 in qualified business income from an active trade or business are guaranteed a minimum deduction of $400, ensuring that even the smallest entrepreneurs benefit. Like the income thresholds, this minimum deduction will also be adjusted for inflation starting in 2026, providing lasting relief to microbusinesses and sole proprietors. Together, these updates to the QBI deduction reflect the OBBBA's broader goal of supporting small businesses, reducing tax burdens, and encouraging long-term investment in the U.S. economy. By removing the expiration date and enhancing accessibility, the Act strengthens a vital tool for American business owners and brings a new level of predictability to tax planning for years to come. Increases Research and Development Deductions The OBBBA introduces a significant change to how businesses handle domestic research and development (R&D) expenses by permanently restoring immediate expensing. This means that companies can now deduct the full cost of their qualified R&D expenditures in the year those expenses are incurred, rather than amortizing them over several years—a requirement that had been in place since 2022 under the TCJA. For small businesses—defined as those with average annual gross receipts of $31 million or less—the law goes a step further. These businesses are allowed to retroactively apply immediate expensing for domestic R&D costs incurred after December 31, 2021, offering a valuable opportunity to amend past returns and recover tax benefits that were previously deferred under the amortization rules. For larger businesses, or those with gross receipts above the $31 million threshold, the legislation allows for a transition period. Domestic R&D expenses incurred between December 31, 2021, and January 1, 2025, that were previously amortized can now be accelerated and deducted over a shortened period of one or two years, depending on the company's choice or eligibility criteria. This acceleration provides meaningful near-term tax relief while phasing in the return to full expensing. Together, these changes are aimed at incentivizing innovation, easing cash flow constraints, and reversing the chilling effect the TCJA's R&D amortization requirement had on business investment in domestic research. The provision is especially beneficial for startups and small tech-driven enterprises, which often rely on R&D investment but lack the capital to wait years for tax benefits to materialize. Increases Business Interest Deductions The new legislation permanently reinstates the EBITDA-based limitation on business interest deductions. EBITDA stands for earnings before interest, taxes, depreciation, and amortization. In 2017, TCJA introduced a limit on business interest expense deductions to 30% of adjusted taxable income (ATI). Initially, from 2018 to 2021, ATI was calculated using an EBITDA-based approach. However, for tax years starting after December 31, 2021, the calculation shifted to an EBIT-based approach (earnings before interest and taxes), which excludes depreciation and amortization. This change generally resulted in stricter limitations and increased tax liability for businesses, particularly capital-intensive companies. In short, by permanently restoring the EBITDA-based limitation, the OBBBA provides many business owners with a greater ability to deduct business interest expenses. This is because the EBITDA-based ATI calculation typically yields a higher ATI amount, enabling a larger interest deduction. This will create some relief for capital-intensive businesses that invest a significant amount into long-lived assets like equipment and machinery. The previous EBIT-based limitation had a negative impact on capital-intensive businesses due to their significant depreciation and amortization expenses. The shift back to EBITDA may alleviate some of the tax burden on these companies in industries like farming and manufacturing. Restores 100 Percent Bonus Depreciation The OBBBA permanently restores 100% bonus depreciation for short-lived investments. Purchases of business assets, such as equipment and vehicles, are now 100% deductible in the year they are purchased and/or put into service for the business. Congress first introduced 100% bonus depreciation as part of the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010. This allowed for a temporary 100% bonus depreciation rate from September 2010 through the end of 2011. More recently, the TCJA of 2017 allowed businesses to deduct 100% of the cost of eligible property placed in service after September 27, 2017, and before January 1, 2023. The TCJA required bonus depreciation began phasing out in 2023, resulting in a reduction in the percentage deductible, decreasing to 80% for 2023, 60% for 2024, and now 40% for 2025. With the BBB, the deduction will be restored to 100% for 2025 and remain at 100% permanently. Plus, for vehicles purchased in your personal name, the law now provides a deduction for auto loan interest of up to $10,000 for purchases of new vehicles that are assembled in the United States. If the vehicle is purchased personally but used in the business, you can take advantage of the deduction for bonus depreciation and the auto loan interest deduction. Provides 100 percent expensing of new business buildings The Act includes a targeted incentive aimed at stimulating domestic industrial investment through a special provision for structures classified as qualified production property (QPP). These are buildings and facilities that are primarily used in the manufacturing, production, or refining of tangible personal property within the United States. The goal is to encourage companies to expand or modernize their physical infrastructure to support domestic industrial activity and strengthen U.S. supply chains. To qualify for the 100% immediate expensing benefit, certain timing and use conditions must be met. Construction of the QPP structures must commence after January 19, 2025, and before January 1, 2029, offering a defined window during which businesses must begin their projects to be eligible. Additionally, the property must be placed in service no later than January 1, 2031, ensuring that the economic benefits are realized within a reasonable timeframe. However, this tax benefit is not universally available to all types of property within a facility. The provision explicitly excludes parts of a structure that are used for non-production activities, such as office space, administrative functions, employee cafeterias, parking garages, and other ancillary or support areas. Only the portions of the structure that are directly involved in qualifying industrial processes—like assembly lines, fabrication areas, or refining equipment spaces—are eligible for the accelerated deduction. This distinction is critical, as it ensures the tax benefit is narrowly tailored to incentivize core production investments rather than general corporate expansion. By doing so, the OBBBA aims to maximize the economic impact of the expensing provision, driving capital investment directly into the sectors and activities that are central to domestic manufacturing competitiveness and economic resilience. The One Big Beautiful Bill Act marks a sweeping shift in U.S. tax policy, particularly for the business community. By making key provisions permanent—like the Qualified Business Income deduction, 100% bonus depreciation, and EBITDA-based interest deductions—while expanding incentives for research, innovation, and industrial infrastructure, the Act seeks to reduce financial friction for businesses of all sizes. It delivers targeted relief to small businesses and capital-intensive industries alike, while sending a clear message: the U.S. is doubling down on domestic growth, productivity, and entrepreneurship. As business owners look ahead, these tax cuts are poised to not only lower costs but also fuel reinvestment, expansion, and innovation in an economy still reshaping itself in the post-pandemic years ahead. Whether you're a startup founder, manufacturer, or seasoned entrepreneur, the OBBBA's top five tax breaks represent new opportunities—and new responsibilities—to plan smart and grow strong.
Yahoo
3 days ago
- Business
- Yahoo
I Asked ChatGPT What the Big Beautiful Bill Means for Upper Class Taxes — Here's What It Said
President Donald Trump's One Big Beautiful Bill Act became U.S. law as of July 4, and my ongoing aspiration to achieve a life of luxury meant I couldn't help but wonder how the legislation would impact taxes for the upper class I hope to one day join. Read More: For You: I'm willing to work hard to become an aristocrat, but not if it means enduring the tedium of trolling through the bill's hundreds of pages — and that's where ChatGPT came in. To cut through the clutter, I asked the AI platform to give me a concise explanation. Here's what it said: In an opening section titled 'Key Impacts on High-Income Taxpayers,' the platform summarized four key ways the bill will help the upper class guard and grow its already sizeable wealth. It cited dozens of sources, such as the Tax Foundation and the New Yorker. This, and all of the following synopses, are word-for-word, with only modest edits for style. Trending Now: The 2017 Tax Cuts and Jobs Act (TCJA) tax rates and brackets are now permanent, continuing lower rates for high earners. The top individual tax rate for millionaires remains at 37%, as the bill did not include President Trump's later pledge to raise it to 39.6%. Temporarily increases the State and Local Tax (SALT) deduction cap to $40,000 (single and joint), indexed upward, but phases out for income above $500,000 (or $250,000 for separate filers) by 30%. After 2030, it reverts to the old $10,000 cap. Despite raising the cap, the phase-out means many upper-income households still see minimal benefit. Continues limiting itemized deductions, capping their value for high earners. Despite expectations, the bill does not eliminate the carried-interest tax loophole, continuing favorable tax treatment for hedge fund and private equity managers. Next was a section titled 'Wealth Transfer: A Big Boost to the Top,' which explained how disproportionately some analysts say the bill favors the wealthy — and who will pick up the tab. Analysts estimate 70% of the tax benefits go to the top 20% of earners and over 20% to the top 1%. The non-partisan Tax Foundation projects the bill will reduce federal revenue by $5 trillion over ten years — far more than it redistributes in lower- and middle-income relief. Critics label it the 'largest upward transfer of wealth from the poor to the rich in U.S. history.' Next, the platform created a table that broke down how the bill boosts the garden-variety rich and the ultra-wealthy elite in different ways. Taxpayer Group Changes Impact Summary High Earners (> $500K/year) Permanent tax rates, modest SALT benefit, deduction caps, no carried-interest reforms Significant net tax savings, though diminished by SALT phase-out Ultra-Wealthy (hedge fund, private equity) Highest brackets unchanged, continued carried-interest loophole Continued preferential treatment, no additional tax burden In closing, ChatGPT generated a section titled 'Bottom Line,' consisting of three bullet points. Upper-income individuals, especially those in the top 1%, see larger tax savings through permanent TCJA rates, expanded SALT deductions and retained loopholes. Though the SALT cap increase offers some relief, the phase-out reduces its effectiveness for high earners. Overall, the bill delivers a significant net tax benefit to the wealthy, while increasing the federal deficit dramatically and shifting fiscal burdens. It closed with this offer: 'If you'd like to explore specific income brackets or scenarios, feel free to ask!' Thanks anyway for now, ChatGPT, but let's revisit this when I hit the big time. More From GOBankingRates Here's the Minimum Salary Required To Be Considered Upper Class in 2025 This article originally appeared on I Asked ChatGPT What the Big Beautiful Bill Means for Upper Class Taxes — Here's What It Said Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
