You’ve probably heard talk about Trump’s “Big Beautiful Bill” and how it’s changing taxes and wealth planning. If you’re in your peak earning years and focused on building and protecting your wealth, you might be wondering:
- Will my taxes go up or down?
- Should I adjust my savings, investments, or business plans?
- How could this affect my estate or future retirement goals?
At Babin Wealth, we believe knowledge is power and taking proactive steps today can help secure your financial future.
Here’s what high-earning professionals, business owners, and individuals working toward significant financial goals need to know.
What Is “Trump’s Big Beautiful Bill”? (And Why It Matters to You)
There’s no official law called “Trump’s Big Beautiful Bill.” However, many use the term to describe the new tax package President Trump signed on July 4th, which makes permanent many provisions from the 2017 Tax Cuts and Jobs Act (TCJA) and introduces several new tax breaks relevant to high earners.
Key highlights of the new law include:
- Extension and Expansion of 2017 Tax Cuts
The bill locks in most individual tax cuts from the 2017 TCJA that were previously set to expire at the end of 2025. This preserves lower marginal tax rates and a higher standard deduction for individuals and families. - No Federal Income Tax on Tips & Overtime
High earners in industries where tips or overtime are significant should note a major new benefit:- Up to $25,000 in deductions for tip income, and
- Up to $25,000 in deductions for overtime pay for individuals earning under $150,000 (single) or $300,000 (joint).
While this eliminates federal income tax liability on those amounts, payroll and state taxes still apply.
- Enhanced SALT Deduction
The state and local tax (SALT) deduction cap has increased from $10,000 to $40,000 for five years, through 2029, before reverting back to $10,000 in 2030. For high earners, especially in states with significant property or income taxes, this creates substantial new planning opportunities. - New Deductions for Seniors and Families
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- Seniors over age 65 receive a new $6,000 deduction.
- There’s a new auto loan interest deduction of up to $10,000 for U.S.-assembled vehicles.
- A special $1,000 “Trump Account” is available for newborns born between 2025–2028, creating new family savings opportunities.
How “Trump’s Big Beautiful Bill” Could Affect High Earners
Trump’s “Big Beautiful Bill” offers high earners valuable opportunities for tax savings and wealth growth. But these benefits only pay off for those who stay proactive and understand how to weave the new rules into their broader financial and retirement plans.
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Lower Tax Rates Maintain Planning Opportunities
With TCJA cuts now permanent, high earners benefit from sustained lower tax brackets. However, future administrations could still revisit tax policy, making proactive planning crucial.
Action Step: Evaluate income-shifting strategies, Roth conversions, and investment moves while rates remain historically low. Babin Wealth can help analyze your situation.
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New Deductions Could Change Tax Strategies
The new federal tax exemption for tips and overtime income offers unique benefits, particularly for high earners close to the $150,000/$300,000 income thresholds.
Action Step: Review your income mix and determine whether any part of your compensation could qualify for these new deductions.
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Enhanced SALT Cap Expands Deduction Options
The higher SALT deduction cap provides significant relief for those facing high property taxes or state income taxes. This elevated cap applies through 2029, after which it returns to prior limits.
Action Step: Consider bunching deductions, advanced charitable giving strategies, or municipal bonds to maximize the higher SALT cap. Babin Wealth can help tailor your plan.
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New Senior and Family Benefits Worth Exploring
Seniors can leverage the new $6,000 deduction to reduce taxable income. Meanwhile, the $1,000 Trump Account offers a modest but potentially valuable boost for families welcoming new children between 2025–2028.
Action Step: Evaluate how these provisions fit into your retirement or family financial plans.
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Arizona-Specific Factors for High Earners
Arizona’s flat 2.5% state income tax means federal changes directly impact your total tax liability. Additionally, Proposition 130 now protects up to $400,000 of home equity, offering extra security for those upgrading property or refinancing.
Snowbirds and frequent travelers should remain cautious: spending over 183 days outside Arizona could expose income to taxation in another state.
Action Step: Work with an advisor like Babin Wealth who helps clients navigate these unique Arizona-specific factors and can integrate them into comprehensive tax and wealth plans.
What Should High Earners Do Now?
Here’s how to stay proactive and protect your wealth under the new law:
- Schedule a Tax Projection — Understand how the permanent cuts and new deductions impact your income, investments, and business profits.
- Review Your Estate Plan — While the estate exemption remains high under current law, tax policy can change quickly.
- Consider Roth Conversions — Take advantage of lower tax rates while they remain in place.
- Plan SALT Strategies — Utilize the temporary higher SALT cap to reduce your overall tax burden.
- Reassess Investments — Factor in new tax dynamics and market trends.
- Get Proactive Advice — Partner with advisors who understand both federal and Arizona-specific nuances.
At Babin Wealth, we help high earners navigate complex tax changes and build strategies to protect and grow your wealth. You’ve worked hard for your success and deserve a plan that keeps you in control.
Bottom Line: Don’t Let Tax Changes Catch You Off Guard
Trump’s “Big Beautiful Bill” has ushered in significant tax updates and the landscape could evolve further with future reforms. Planning ahead helps ensure your financial goals remain on track.
Curious how the new law could affect your taxes, investments, or estate plans? Schedule a complimentary meeting with Babin Wealth today and take proactive control of your financial future.
