On July 4, 2025, a major new tax law—called the One Big Beautiful Bill Act—was signed into law. No matter how you feel about it politically, the real question is: What does this mean for your retirement?

In our latest Richmond Refreshers video, Dan Vredveld, CFP, breaks it down in plain English.
👉 Watch the video below or keep reading for the highlights:

Here are 5 things you should know:

1. The Trump-era tax cuts are now permanent.
That means lower tax rates—originally set to expire in 2025—are now locked in. This creates more predictability and opens up continued planning opportunities for retirees.

2. Seniors get a new $6,000 bonus deduction.
One of the most headline-worthy parts of the bill is a temporary “Senior Standard Deduction” available from 2025 through 2028:

• $6,000 for individuals age 65+
• $12,000 for married couples if both are age 65+

This is on top of the regular standard deduction you already get. For many retirees, this could lower or even eliminate your taxable income—especially if your retirement income is moderate and your assets are in tax-advantaged accounts.

3. Social Security benefits will be tax-free for most retirees.
According to the Social Security Administration, nearly 90% of retirees are expected to owe no federal tax on Social Security, boosting income stability.

Does This Change How Social Security Is Taxed? Not exactly. The One Big Beautiful Bill does not change the tax code rules that govern how Social Security benefits are taxed. Those rules—where up to 50% or 85% of your benefits may be taxable—are still in place.

However, because of the new additional deduction for seniors, the vast majority of retirees (nearly 90%) are expected to owe no federal income tax on their Social Security benefits between 2025–2028. This is due to how the deduction reduces total taxable income—not a repeal of Social Security taxation itself.

4. The estate and gift tax exemptions are rising.
In 2026, you’ll be able to pass on up to $15 million per person—$30 million for couples—without federal estate tax. A powerful tool for those thinking about legacy or charitable giving.

5. The deficit is expected to grow—so planning ahead is critical.
The bill is expected to add trillions to the national debt, which could impact future tax policy, inflation, and interest rates.

💬 What About Roth IRAs and conversions?

Even though the new law doesn’t directly change Roth accounts, many experts think we’ll see more of them ahead. That’s because Roths are taxed now—which gives the government more revenue today.

With tax rates staying low, now may be a good time to explore a Roth conversion. Especially if you can use deductions like the new senior deduction or expanded SALT (State and Local Tax) deduction to offset the tax impact.

🎯 Time to Revisit Your Strategy?

If you’re a Richmond Brothers client, this is a great topic to bring up during your next RECONNECT Visit. We’ll walk through how this new law may impact your retirement plan and make any needed adjustments.

If you’re not a client yet, we’d love to chat. We offer a complimentary 20-minute call so you can ask questions and see if we might be a good fit for your retirement goals.

At Richmond Brothers, our mission is to help you live fearlessly into and through retirement. That means helping you make informed decisions and feel confident in every season.

📞 Schedule a no-cost, no-obligation call here or at 517-435-4040

Sources:

https://blog.ssa.gov/social-security-applauds-passage-of-legislation-providing-historic-tax-relief-for-seniors/ Accessed July 8, 2025.

Kate Dore, Lorie Konish, Greg Iacurci, Jessica Dickler, Annie Nova. CNBC. July 4, 2025. “What Trump’s ‘one big beautiful’ tax-and-spending package means for your money.” https://www.cnbc.com/guide/what-trumps-one-big-beautiful-bill-means-for-your-money/#trumps-2017-tax-cut-extensions. Accessed July 7, 2025.

Garrett Watson, Huaqun Li, Erica York, Alex Muresianu, Alex Durante, Alan Cole, Peter Van Ness. The Tax Foundation. July 3, 2025. “‘One Big Beautiful Bill Act’ Tax Policies: Details and Analysis.” https://taxfoundation.org/research/all/federal/big-beautiful-bill-senate-gop-tax-plan/. Accessed July 7, 2025.