State and local tax deduction

The state and local tax deduction limit was raised to $40,000 annually for a five-year period, adjusted for inflation; it reverts to $10,000 in 2030.

There is also a phase-down for modified adjusted gross incomes above $500,000, but never below $10,000.

After the five-year period, the limit would snap back to the current $10,000 limit imposed in the 2017 tax law.

Please note: some business owners don't need to abide by the SALT cap that applies to everyone else, thanks to legal workarounds approved by legislatures in New York, New Jersey, Connecticut, California and dozens of other states.

No tax on tips

Workers would be exempt from taxes on tip income up to $25,000 per individual, as well as overtime up to $12,500 per individual and $25,000 per couple.

The tax breaks run through 2028. Those deductions start to phase out at $150,000 in income per person.

Electric vehicles

A popular $7,500 tax credit for consumer purchases of new and used electric vehicles would end on Sept. 30, 2025, earlier than previous versions of the bill that would have eliminated the credit at the end of the year.

Auto loan tax deduction

A deduction up to $10,000 would be established for interest payments on auto loans from 2025 through 2028. The tax break is only eligible for new vehicles whose final assembly is in the US.

Permanent business tax breaks

Three business tax deductions would be made permanent.

That includes the ability to use depreciation and amortization as the basis for interest expensing, the research and development write-off and a 100% bonus depreciation of certain property, including most machinery and factories.

Child tax credit

The maximum child tax credit would rise to $2,200 from $2,000 per child. It also would be made permanent and adjusted for inflation.

The $1,400 refundable credit is made permanent.

The $500 dependent credit is also made permanent.

A Social Security number is required for the credit.

Trump child accounts

Parents, relatives and others would be able to contribute up to $5,000 in total annually to tax-deferred "Trump" investment accounts for children until they turn 18.

Children who are U.S. citizens born from 2025 through 2028—essentially, during Trump's current term—would get a $1,000 contribution into their accounts from the federal government.

Remittances

Migrants and others who send money abroad would be taxed at 1% of the amount of the transfer.

Credits:

What's in the Trump tax bill that just passed the Senate | Accounting Today

Inside the Senate version of the Trump tax bill OBBBA | Accounting Today