Tax Planning
Maximizing Deductions under the One, Big, Beautiful Bill: A Guide for Individuals & Businesses
The One, Big, Beautiful Bill introduces sweeping changes—100% first-year depreciation, SALT deduction cap increases, and more. Learn how to leverage these shifts for tax-savings strategies in 2026.
By NomadicTax Research Team • 5-8 min read • March 31, 2026
## What’s New Under the One, Big, Beautiful Bill (OBBBA)
The United States’ One, Big, Beautiful Bill has introduced several major changes that took effect on or after January 19, 2025 and affect tax year 2025 and beyond. Key changes include:
- **Permanent 100% Bonus Depreciation** for qualified property—no more phase-downs for most assets. ([irs.gov](https://www.irs.gov/irb/2026-06_IRB?utm_source=openai))
- **Increased SALT Deduction Caps**: the state and local tax deduction increases from $10,000 up to $40,000 (for single & joint filers), subject to MAGI limitations. ([taxpayeradvocate.irs.gov](https://www.taxpayeradvocate.irs.gov/wp-content/uploads/2026/01/ARC25_ExecSummary.pdf?utm_source=openai))
- **Enhanced Deductions for Seniors**: Individuals 65+ can claim an additional deduction ($6,000 per person; $12,000 married filing jointly) phased out over income thresholds. ([irs.gov](https://www.irs.gov/newsroom/2026-filing-season-updates-and-resources-for-seniors?utm_source=openai))
## Categories Benefiting Most & How to Plan
| Type of Taxpayer | Opportunity | Strategic Action |
|---|---|---|
| **Business Owners / Real Estate Investors** | Immediate expensing of eligible assets—machinery, equipment, certain buildings—placed in service after Jan 19, 2025. ([irs.gov](https://www.irs.gov/irb/2026-06_IRB?utm_source=openai)) | Keep precise records of acquisition and service dates; ensure property qualifies under definitions; consider accelerating purchases before involuntary delays or regulatory interpretations sharpen. |
| **Employees & Itemizers** | Larger SALT deductions for those with high state/local tax burden; but phase-outs begin at MAGI over $500,000. ([irs.gov](https://www.irs.gov/newsroom/understanding-the-one-big-beautiful-bill-individual-tax-provisions-youtube-video-text-script?utm_source=openai)) | Estimate MAGI carefully; consider income shifting strategies; calculate whether itemizing vs standard deduction yields more benefit. |
| **Seniors & Retirees** | Extra deduction and possibly lower tax liability; especially valuable if taken standard deduction. ([irs.gov](https://www.irs.gov/newsroom/2026-filing-season-updates-and-resources-for-seniors?utm_source=openai)) | Seniors should confirm eligibility (must be 65 by end of tax year); adjust withholding or estimated payments; evaluate whether itemization still makes sense. |
## Practical Examples
- **Example 1**: A real estate investor acquired office equipment in May 2025. Under prior law, only 40% bonus was allowed in 2025, but under OBBBA they can depreciate **100%** of the equipment in the first year. Proper documentation is key. Ex: purchase invoices, placement in service date.
- **Example 2**: A couple earning a combined MAGI of $550,000 in 2025. Their SALT deduction above $500,000 is reduced by 30% of the excess. So if their state/local taxes are $50,000, the cap becomes somewhat less—plan accordingly.
- **Example 3**: John, age 67, files jointly; standard deduction for married filing jointly is $32,200; plus senior deduction of $12,000 (both spouses 65+) brings deduction to a total of **$44,200**, if they take standard. If itemizing, may exceed that—but must verify.
## Actionable Insights
- Review FY2025 & FY2026 acquisitions and consider timing purchases to maximize deductions.
- Keep clean, contemporaneous records, including when property is placed in service/entered production.
- Recalculate withholding or estimated tax payments if expecting lower liability—especially for seniors or when SALT deductions rise.
- For high-income earners, model marginal tax liability with and without itemizing, to see if higher federal withholding or tax planning (e.g. via prepayments or charitable contributions) makes sense.
## Potential Pitfalls & Compliance Notes
- The extra senior deduction phases out once MAGI crosses $75,000 (single) / $150,000 (joint). Not available if over those limits. ([irs.gov](https://www.irs.gov/newsroom/2026-filing-season-updates-and-resources-for-seniors?utm_source=openai))
- For SALT deductions, even with cap increases, there’s still a phase-down above high income thresholds. Be aware of how your income level affects eligibility.
- Bonus depreciation and additional first-year deductions have specific rules (what qualifies, when placed in service, etc.). Regulations (proposed or final) may add further detail. Always follow latest guidance.
## Conclusion
OBBBA’s tax changes are among the most significant in recent years. With permanent 100% bonus depreciation, enhanced deductions for seniors, and an expanded SALT cap, both individuals and businesses have real opportunities—if planned for properly. Staying ahead through good recordkeeping, estimating income, and being aware of thresholds will help maximize benefits while remaining compliant.