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From Estate to Education: What the OBBBA Means For Your Wealth Strategy

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Planning

On July 4th, President Trump signed the One Big Beautiful Bill Act (OBBBA), marking the most significant tax code change since 2017. The bill is far-reaching, with changes spanning estate planning, business ownership, education, retirement, energy, and healthcare. While we’re still reviewing the full scope of the legislation, we’ve highlighted a few of the most relevant changes that may impact your financial life and long-term goals.

 

Key Highlights: 

 

Estate Tax Exemption

  • What’s Changing: 
    • The federal estate and gift tax exemption is now permanently set at $15 million per person (or $30 million per married couple) beginning in 2026, indexed for inflation. In 2025, the current federal estate tax exemption is $13.99 million per person and $27.98 million per couple. Many had been preparing for a potential sunset of the prior rules at year-end, so this change provides welcome clarity and extended planning flexibility. Just months ago, we posted about changes to Washington State’s estate tax laws that saw the state estate tax exemption increase, along with the top tax rate. 
    • Takeaway:
      • This creates new opportunities to revisit your gifting strategy, trusts, or wealth transfer plans with more confidence and less urgency.

 

Qualified Small Business Stock (QSBS) Changes 

  • What’s Changing: 
    • The One Big Beautiful Bill Act makes three major changes to Qualified Small Business Stock (QSBS) effective for stock issued after July 4, 2025:
      • Tiered Gain Exclusion: Now 50% after 3 years, 75% after 4, 100% after 5
      • Higher Cap: Per-issuer exclusion cap raised from $10M to $15M (indexed for inflation)
      • Bigger Eligibility Window: Gross asset threshold raised from $50M to $75M
  • Takeaway:
    • These changes may offer greater tax savings and planning flexibility for founders, early-stage investors, and entrepreneurs preparing for a liquidity event, sale or exit.

 

Senior Deduction & Social Security Tax Relief

  • What’s Changing: 
    • Starting in 2025, taxpayers age 65+ will receive an additional standard deduction of $6,000 ($12,000 for couples). This deduction begins phasing out at income levels $75,000–$175,000 (individuals) and $150,000–$250,000 (couples). While it doesn’t repeal taxation on Social Security, it may reduce the portion of benefits taxed by lowering overall taxable income. The provision is set to expire after 2028.
  • Takeaway:
    • This may impact your retirement strategy, including decisions around when to draw from tax-deferred accounts or whether to consider Roth conversions.

 

529 Plan Expansion

  • What’s Changing: 
    • 529 plan funds can now be used more broadly – for K-12 private and religious school tuition, qualifying homeschooling expenses, and existing college, trade, and credentialing programs.
  • Takeaway:
    • These changes may offer greater flexibility and earlier access to 529 funds. If you’re helping support a child or grandchild’s education, it may be time to revisit how your education savings strategy fits into your larger wealth plan.

 

Trump Accounts

  • What’s Changing: 
    • The OBBBA introduces Trump Accounts—a new savings vehicle structured like a Roth IRA to support children under age 18. Children born between 2025 and 2028 will receive a one-time $1,000 government-funded deposit when a Trump Account is opened on their behalf. Contributions are limited to $5,000/year (indexed after 2027), with qualified tax-advantaged withdrawals available at age 18 for:
      • Higher education
      • Career credentialing
      • Small business or farm startup
      • First-time home purchase
  • Takeaway:
    • Trump Accounts offer an alternative to 529s, but with important differences in contribution limits, flexibility, and expiration. We are tracking technical guidance closely to help assess how these accounts may fit into your broader savings and gifting strategies.

 

What’s Next
Major tax law changes often bring both complexity and opportunity. While this isn’t an exhaustive list, these updates reflect the most impactful provisions of the OBBBA. As always, we’re here to help you assess how these changes may affect your goals and identify smart, timely strategies to adapt with confidence.

If you’d like to talk through what matters most for your goals and strategy, we’re just a call away.

 

With Optimism,

Tschetter Group Planning Department

 

Sources:

Investopedia. (2025, July). 7 Things Retirees Need to Know About the Big Beautiful Bill Act. Retrieved from https://www.investopedia.com/the-big-beautiful-bill-and-retirees-11766799

MarketWatch. (2025, July 1). Even with the megabill’s higher $15 million estate‑tax exemption, estate planners won’t be out of jobs. Retrieved from https://www.marketwatch.com

Kiplinger. (2025, July). Big GOP tax bill could change your estate planning for 2025. Retrieved from https://www.kiplinger.com/taxes/big-gop-tax-bill-could-change-your-estate-planning

Tax Foundation. (2025, July). One Big Beautiful Bill Act Tax Policies: Details and Analysis. Retrieved from https://taxfoundation.org/research/all/federal/big-beautiful-bill-senate-gop-tax-plan/

Frost Brown Todd LLC. (2025, July). One Big Beautiful Bill Act doubles down on QSBS… Retrieved from https://frostbrowntodd.com

Gould & Ratner LLP. (2025, July). OBBB Act brings significant changes to Section 1202 QSBS gain exclusion. Retrieved from https://gouldratner.com

Lathrop GPM. (2025, July). Tax Update: One Big Beautiful Bill Act signed into law – What does it mean for you? Retrieved from https://www.lathropgpm.com

Dentons. (2025, July 9). Turbocharged QSBS benefits signed into law. Retrieved from https://www.dentons.com

Loeb & Loeb LLP. (2025, July). The One Big Beautiful Bill Act: breaking down key changes in the new tax legislation. Retrieved from https://www.loeb.com

 

Important Disclosures:

The content of this article is provided for general information purposes only and is presented solely as our opinion. The information was compiled from sources that we believe to be reliable; however, we cannot guarantee its accuracy, completeness, or timeliness. This article is based on the information available to us as of the date of this article and may change at any time. Tschetter Group does not provide tax and legal advice. Please consult your legal and tax professionals for specific information.

Tschetter Group (“TG”) is a registered investment adviser with the Securities and Exchange Commission. The information provided by TG (or any portion thereof) may not be copied or distributed without TG’s prior written approval. All statements are current as of the date written and does not constitute an offer or solicitation to any person in any jurisdiction in which such offer or solicitation is not authorized or to any person to whom it would be unlawful to make such offer or solicitation. Different types of investments involve varying degrees of risk. Risk Disclosure Statement: All investments include a risk of loss that clients should be prepared to bear.

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