A lot changed for 2025, most of it from one law signed in July 2025, the One Big Beautiful Bill Act. The parts that reach your return are below.
The rates and standard deduction did not snap back
The 2017 tax law was set to expire after 2025, which would have raised rates and cut the standard deduction. The new law made them permanent. For 2025 the standard deduction is $15,750 for a single filer and $31,500 for a married couple filing jointly. Your brackets stay where they were.
New deductions on what you earn
Three new breaks show up on 2025 returns, each with income limits, each running through 2028.
| Deduction | 2025 cap | Phases out above (MAGI) |
|---|---|---|
| Tips | up to $25,000 | $150,000 single / $300,000 joint |
| Overtime (premium part) | up to $12,500 ($25,000 joint) | $150,000 / $300,000 |
| Senior (65+) | up to $6,000 per person | $75,000 / $150,000 |
You can take these whether you itemize or use the standard deduction.
SALT relief, for now
The cap on deducting state and local taxes went from $10,000 to $40,000 for 2025, which matters if you itemize and pay real estate and state taxes. It phases down over $500,000 of income and is set to step back down later this decade.
Most of the 2025 changes are deductions with income limits. Whether they reach you depends on your numbers, not the headline.
For business owners
Two that matter for a business
100% bonus depreciation is back and permanent for equipment placed in service on or after January 19, 2025, so a qualifying purchase can be written off in full the first year. And the QBI deduction, worth up to 20% of qualified business profit, was made permanent instead of expiring.
What to do with this
Each of these has eligibility rules and phase-outs that decide whether you get the full amount, part, or none. The headline is not the return. If you had tips, overtime, a big equipment purchase, or income near one of the phase-out lines in 2025, that is worth a look before you file. Book a consultation.