About the OBBB Act (One Big Beautiful Bill)

The One Big Beautiful Bill Act (Public Law 119-21) was signed into law on July 4, 2025, and provides significant tax relief for American workers and families from 2025 through 2028.

Four Major Tax Deductions

🎯 No Tax on Tips

Max Deduction: $25,000/year

Phase-out: Starts at $150,000 income ($300,000 married)

Covers qualified tips from IRS-listed occupations including servers, bartenders, delivery drivers, and more.

⏰ No Tax on Overtime

Max Deduction: $12,500 ($25,000 married)

Phase-out: Starts at $150,000 income ($300,000 married)

Deduct the premium portion of overtime pay (e.g., the "half" in time-and-a-half).

🚗 No Tax on Car Loan Interest

Max Deduction: $10,000/year

Phase-out: Starts at $100,000 income ($200,000 married)

For new vehicles with final assembly in the USA, purchased after 12/31/2024.

👴 Senior Deduction

Max Deduction: $6,000 per person ($12,000 married)

Phase-out: Starts at $75,000 income ($150,000 married)

Additional deduction for taxpayers age 65 or older.

Who Can Benefit?

Restaurant workers, bartenders, delivery drivers: Save on tip income
Manufacturing workers, nurses, hourly employees: Save on overtime pay
New car buyers: Deduct interest on qualifying vehicle loans
Seniors 65+: Additional $6,000+ deduction
Families: Combined benefits can save thousands annually

Important Eligibility Notes

All deductions are available for both itemizing and non-itemizing taxpayers
Must include Social Security Number on tax return
Married taxpayers must file jointly to claim these deductions
Phase-outs reduce deductions for higher-income taxpayers
Some occupations and business types have special restrictions

Disclaimer: This calculator provides estimates only. It does not constitute tax advice. The OBBB Act has complex eligibility requirements and phase-out rules. Always consult with a qualified tax professional or use official IRS resources for your specific situation.

What's My Tax Savings?

Your Estimated Tax Savings