How President Trump’s Big Beautiful Bill Could Impact Your Tax Refunds

This article originally appeared in The New York Post

The first tax season under President Trump’s One Big Beautiful Bill Act is fast approaching – and most filers can expect a slew of fresh and enlarged deductions that will result in bigger refund checks in the mail.

The tax-and-spending bill is expected to go down as the signature legislative achievement of Trump’s second term, extending his 2017 tax cuts and adding an estimated $4 trillion to the deficit. It also will save the average US taxpayer hundreds if not thousands of dollars, according to experts.

“These changes to the standard deduction, SALT cap and tax exemptions on tips, overtime and senior bonus mean most people will be paying less in taxes or getting a bigger refund in April,” Nathan Goldman, tax expert and professor at North Carolina State University, told The Post.

Higher standard deduction

Arguably the most significant tweak in the bill is an increase to the standard deduction, since this will affect the largest chunk of American taxpayers.

While standard deductions tick up every year, they saw two increases in 2025: once at the start of the year, and once with the passage of Trump’s One Big Beautiful Bill Act.

The bill increased the standard deduction for a single filer to $15,750, up from $15,000, and for a married couple to $31,500, up from $30,000.

“That’s an extra few hundred dollars that you’re getting back,” Goldman said. “That one’s huge because now we’re talking about a huge deduction that every single person is getting regardless of all your other activities.”

SALT deduction cap

Another major change in Trump’s tax-and-spending bill is the new cap to state and local tax, or SALT, deductions.

It quadruples the SALT deduction cap to $40,000, though this is temporary and will drop back down to $10,000 in 2029.

“Some of the biggest itemized deductions come down to what you pay in property taxes, and property taxes are very expensive in New York, Florida, California. Instead of only being able to itemize $10,000, they’re going to be able to itemize up to $40,000,” Goldman said.

But the new cap will benefit some more than others, according to EJ McMahon, a fellow at the Manhattan Institute for Policy Research.

Single filers can claim the full amount – but married couples who file jointly would share the $40,000 SALT deduction between both spouses.

Since the standard deduction is $31,500, it might be more beneficial in some cases for the married couple to continue taking that standard deduction.

But if they are already itemizing – for example, if they own a home – then the SALT cap could prove more optimal.

“The most likely beneficiaries will be a large [swath] of middle- and upper-middle-income families in the New York City suburbs of Long Island and the lower Hudson Valley, where a combination of local property taxes and state income tax can easily range from $20,000 to $25,000,” McMahon told The Post.

While the impact will not be as large for upstate homeowners, those in metro suburbs around Albany, Syracuse, Rochester and Buffalo will still benefit.

“Do your state and local taxes plus mortgage interest plus charitable contributions exceed $31,500? Then you benefit,” McMahon said. “The answer is more likely to be yes if you are a middle-class homeowner downstate.”

The full SALT deduction phases out for filers with gross income above $500,000, and reverts to $10,000 for incomes of at least $600,000.

No tax on tips and no tax on overtime

Service workers can now deduct up to $12,500 of tip income annually, and hourly workers can deduct up to $12,500 of overtime pay each year – or $25,000 in both cases if filing as a married couple.

“When the president was designing this bill, the intention was for everyone to get a tax cut, and I think generally speaking, that is what is going to happen, which I think you would expect from a tax bill that’s this large,” Alex Durante, senior economist at the Tax Foundation, a tax policy nonprofit, told The Post.

“It’s largely going to be the tipped workers, which I think the definition of what counts as a tipped worker itself was expanded by the IRS after the bill passed, so that could end up being a larger group than was anticipated,” he added.

The official list of approved occupations covers industries like hospitality, food and beverage, transportation and delivery and home services. There are also income caps on these deductions.

While the SALT cap will primarily help upper-middle-class filers, the new rules for tipped and overtime workers “are gonna have an impact on average [on] lower-income individuals,” Goldman said.

Continued over at The New York Post:

Here’s how Trump’s Big Beautiful Bill could impact your tax refunds in April https://t.co/NcnSEcltQJ pic.twitter.com/sIjSQfdxif

— New York Post (@nypost) December 22, 2025