With $4.5 trillion in tax relief, individuals, business owners and families can now leverage tax savings to build stronger retirement, estate and business continuity plans.
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Signed into law on July 4, 2025, the One Big Beautiful Bill Act (H.R. 1) represents a sweeping overhaul of the US tax code. With an estimated $4.5 trillion in tax relief, the bill introduces a mix of permanent and temporary provisions that affect individuals, businesses and estates.

Below are the key takeaways and planning opportunities to help you quickly understand the bill's impact on your clients.

Reach out to your Gallagher Life consultant to discuss strategies that can effectively meet your client's needs.

Key H.R. 1 takeaways and planning opportunities for individuals

Provision Overview Planning Opportunity
Higher standard deduction amount made permanent The income tax rates that the Tax Cuts and Job Act introduced in 2017 are permanent. Starting in 2025, the standard deduction is $15,750 for single filers and $31,500 for joint filers, adjusted for inflation. Stable tax brackets and higher deductions boost cash flow for life insurance, annuities, disability, or long-term care planning.
Enhanced income tax deduction for seniors A new $6,000 deduction for filers 65+ with income under $75,000 (single) or $150,000 (married). Tax savings can be invested into annuities for guaranteed income, healthcare funding, or long-term care planning.
Reduce income tax on tips and overtime Up to $25,000 in tips and overtime can be deducted from taxable income (2025-2028), with phaseouts above $150K (single) or $300K (married). A temporary income boost can fund short-term life insurance or annuity contributions for retirement income.
Child Tax Credit increased and made permanent Child tax credit increased to $2,200 in 2026, made permanent and indexed for inflation. Families can use tax savings to fund life insurance for parents or annuities for retirement planning.
Trump Accounts for Kids New savings account for children born in 2025-2028, with $5,000 annual contribution limit and one-time deposit of $1,000 federal seed. Encourages early savings and can complement juvenile life insurance or education planning.
State and local tax deduction cap increase Cap raised to $40,000 in 2025, increasing 1% annually through 2029, then reverting to $10,000 in 2030. Phased out above $500,000 income. High earners in high-tax states can redirect savings into estate planning using permanent life insurance or retirement income planning using annuities.

Key H.R. 1 takeaways and planning opportunities for businesses

Provision Overview Planning Opportunity
Qualified business income deduction made permanent The 20% deduction for qualified business income from pass-through entities is now permanent. Tax savings can fund buy-sell agreements, key person insurance or executive bonus plans.
Bonus depreciation and investment credits Incentives for business investment in equipment and manufacturing infrastructure. Freed-up capital can support benefit plans to attract, retain and engage employees and fund succession plans.
Qualified small business stock capital gains exemption tiered Exemption for small business stock: 50% exclusion after 3 years, 75% after 4 and 100% after 5 for stock issued by companies under $75M. Proceeds from business exits can fund retirement income using annuities and legacy planning using life insurance.

Key H.R. 1 takeaways and planning opportunities for estates

Provision Overview Planning Opportunity
Higher estate and gifting exemptions made permanent Exemption set at $15M per person ($30M per couple) in 2026, indexed for inflation. Life insurance and annuities can provide liquidity, estate equalization, special and blended family needs, as well as tax mitigation.
State estate taxes still apply 17 states impose estate taxes, often with low exemptions and no portability. Planning with irrevocable life insurance trusts (ILITs) or state-specific strategies is critical.

Disclaimer

For Financial Professional Use Only. Not For Use with the Public.

GBS Insurance and Financial Services, Inc. does not provide investment, tax, or legal advice. The information presented here is not specific to any individual's personal circumstances. To the extent that this material concerns tax matters, it is not intended or written to be used, and cannot be used, by a taxpayer for the purpose of avoiding penalties that may be imposed by law. Each taxpayer should seek independent advice from a tax professional based on his or her individual circumstances. Discussions of the various planning strategies and issues are based on our understanding of the applicable federal income, gift, and estate tax laws in effect at the time of publication. However, these laws are subject to interpretation and change, and there is no guarantee that the relevant tax authorities will accept GBS Insurance and Financial Services, Inc. interpretations. Clients are strongly encouraged to work with and consult with their tax advisors and attorneys