2025: The Year of Permanence in Federal Taxation… For Now
For years, taxpayers have grown used to expiring provisions and last-minute tax changes that make planning more difficult. The Tax Cuts and Jobs Act (TCJA) of 2017 was no exception: many of its benefits were scheduled to disappear after 2025, threatening higher tax rates and more confusion.
On July 4, 2025, Congress delivered long-awaited clarity. With the passage of the One Big Beautiful Bill Act (OBBBA), most of those provisions are no longer temporary. The rules have been made permanent…. Well, at least for now.
What Changed
Stable Tax Rates.
The familiar seven federal tax brackets—10%, 12%, 22%, 24%, 32%, 35%, and 37%—are now permanent. The IRS has already updated the thresholds for 2025 to reflect inflation adjustments, such as the 37% rate kicking in at $626,350 for single filers and $751,600 for couples filing jointly.
Retirement Deduction for Seniors.
Starting in 2025, anyone age 65 or older may claim a new $6,000 deduction (available through 2028), in addition to existing standard deductions. The benefit phases out for incomes above $75,000 (individual) / $150,000 (joint filers).
Special Deduction for Tipped Workers.
Individuals in occupations that rely predominantly on tips can deduct up to $25,000 (2025–2028), as long as those tips are properly reported via W‑2, 1099, or Form 4137.
Student Loan Relief.
Employer-paid student loan benefits of up to $5,250 per year are now permanent. In addition, student loans discharged due to death or disability are no longer taxable.
Farmland Sales.
Beginning in 2025, sellers of farmland to qualified farmers can spread taxable gain over four years, recognizing one-fourth in the year of sale and one-fourth in each of the following three years. This provision smooths out taxable income, reduces bracket creep, and helps keep farmland in agricultural use. If the seller dies or liquidates, the remaining balance is accelerated.
Section 179 Expensing.
OBBBA permanently increases Section 179 expense limits. Businesses can now deduct up to $2.5 million in qualifying purchases, with the phase-out beginning at $4 million. This doubles prior limits and provides certainty for small and mid-sized businesses investing in equipment, vehicles, and property.
Bonus Depreciation.
Allows businesses of all sizes to immediately expense major capital investments, from machinery to technology infrastructure, without waiting years for depreciation deductions. OBBBA restores 100% bonus depreciation for qualified property placed in service after January 19, 2025. Businesses of all sizes can now fully expense capital investments immediately.
Why This Matters
These changes give you something that has been missing from tax planning for nearly a decade: certainty.
Farmers and landowners can soften the tax hit when selling farmland, spreading the gain over multiple years.
Business owners can accelerate deductions through enhanced Section 179 and full bonus depreciation, improving cash flow and return on investment.
Families and individuals gain stability in tax brackets and access to new deductions for seniors, tipped workers, and student loan benefits.
In short: you can finally plan with more confidence instead of waiting on the outcome of additional legislation.
What You Should Do Now
The opportunities created under OBBBA are highly personal. The right strategy depends on your income, your business structure, and your goals.
Should I accelerate income or capital gains to fill today’s lower brackets?
Should I use Roth conversions or other retirement strategies while rates are locked in?
Do I qualify for new deductions that apply only between 2025 and 2028?
Should I purchase equipment or vehicles now to take advantage of Section 179 and permanent 100% bonus depreciation?
How do the new farmland sale rules affect my estate or succession planning?
The One Big Beautiful Bill Act (OBBBA) delivers stability; however, that is for now. In our system, the tax code can significantly change. For individuals, business owners, and farmers, 2025 is the year to shift from reactive tax planning to proactive strategy. With permanence on your side now, it is time to stop guessing and start building a long-term tax plan with confidence.
If you have been waiting for clarity before making equipment purchases, property sales, or retirement planning, that moment has arrived. The tax landscape is now more predictable, but the strategies that save the most money are highly specific to you.
Recommended Reading
Want to dive deeper into the new law? Here are some trusted resources that explain the One Big Beautiful Bill Act (OBBBA) and its impact:
IRS Newsroom — One, Big, Beautiful Bill Act of 2025 Provisions
Official IRS summary of the Act’s tax provisions, including the new $6,000 senior deduction, $25,000 tip income deduction, farmland sales deferral, and student loan relief.
Read here →IRS Fact Sheet — One, Big, Beautiful Bill Act: Tax Deductions for Working Americans and Seniors (FS 2025-03, July 14, 2025)
A plain-language IRS fact sheet explaining OBBBA changes most relevant to individuals and families, especially seniors and tipped workers.
Read here →IRS Newsroom — No Changes to Information Returns or Withholding Tables for 2025 under OBBBA (IR-2025-82, Aug. 7, 2025)
Clarifies that despite OBBBA’s passage, W-2s, 1099s, and withholding tables remain unchanged for 2025—important for payroll and HR professionals.
Read here →RSM — The One Big Beautiful Bill Act: Business Tax Impact
Practitioner-level analysis breaking down what OBBBA means for businesses, with special focus on depreciation, international provisions, and planning opportunities.
Read here →Grant Thornton — OBBBA Offers New Ways to Accelerate Depreciation
In-depth review of how OBBBA restores 100% bonus depreciation, expands expensing, and impacts business capital investment strategies.
Read here →
