It is a good time to be wealthy in America. Along with the benefits of the One Big Beautiful Bill Act (OBBBA), high asset earners can look forward to tax cuts that benefit their families and businesses.
While the economic climate appears chronically unstable, the prospect of the upcoming tax season offers some comfort for those in higher tax brackets. Sweeteners provided during President Trump’s first term in office have been extended, including tax breaks, business pass-through benefits and immediate bonus depreciation for businesses, which also assist small business owners.
A higher federal tax deductible will benefit high earners who itemize, and estate planning just got easier with a boost in the lifetime exemption for gift and estate taxes. This change will reduce estate tax exposure for those with higher net worth. For taxpayers who realized capital gains from the sale of small business stock after July 4, 2025, the capital gains exclusion has been raised to $15 million, a $5 million increase for businesses holding assets under $75 million.
And still more…
Passed in 2022, the Inflation Reduction Act created the corporate alternative minimum tax to improve transparency and reduce tax evasion. According to the IRS, CAMT imposed a 15 percent minimum tax on the adjusted financial statement income (AFSI) of large corporations following year end 2022. According to media reports, actions taken or signaled by the Trump Administration to reduce CAMT-related tax woes of top corporate earners include offering bigger breaks to multinational corporations, the crypto industry and private equity firms.
A Treasury official told The New York Times, the tax adjustments are, “a practical approach that supports American investment and competitiveness” and were meant to replace the Biden administration’s “compliance maze that would have buried taxpayers in red tape.”
TOBBBA also provided tax breaks for specific industries, including oil and gas, banking, distilled spirit makers, sound recording studios and spaceports. Without including Elon Musk’s SpaceX spaceport in Boca Chica or facilities located on federal air force bases, there are 14 spaceports in the United States licensed by the Federal Aviation Administration and designed for the testing, departure and landing of spacecraft and satellites.
For taxpayers in higher income brackets, these changes underscore how quickly tax law can shift and how materially those shifts can affect long-term planning for income, estates and business interests.
Questions on tax breaks or compliance?
Changes in tax policy often create opportunity, but they can also introduce risk if misunderstood or applied incorrectly. The tax attorneys at Robert J. Fedor, Esq., L.L.C., deliver the guidance needed to help ensure tax returns, payroll operations and offshore holdings remain compliant with applicable IRS requirements. Contact our knowledgeable tax attorneys today at 440-250-9709. We serve clients across the U.S. and internationally from our offices in Cleveland and Chicago.
For a resource on common tax penalties, filing missteps and forms of tax fraud, download our fee ebook, "Since You Asked: 15 Common and Concerning Tax Law Questions and Answers."
