Money Guy Show: What You Need to Know About the New Tax Bill

Episode Release Date: June 11, 2025

In this insightful episode of the Money Guy Show, hosts Brian Preston and Bo Hanson delve into the intricacies of the proposed new tax bill, dissecting its potential impact on personal finances. Released on June 11, 2025, the episode provides listeners with a comprehensive overview of the legislative changes on the horizon and practical advice on how to navigate them. Additionally, the hosts engage with their audience through a lively Q&A session, addressing real-world financial concerns.

I. Introduction to the New Tax Bill

Brian Preston opens the discussion by highlighting the buzz around a proposed tax bill, emphasizing the need to distinguish between credible changes and mere political noise.

“[00:00] Brian Preston: ...we needed to tell you what's noise and what do you actually need to know.”

Bo Hanson echoes this sentiment, expressing enthusiasm about unpacking potential tax changes and their implications for listeners.

“[00:13] Bo Hanson: ...there may potentially could be some tax changes coming down the pipe. And we want you to know what they could be and how they might affect you.”

II. Overview of the New Tax Bill

The hosts clarify their usual cautious approach to discussing pending legislation but acknowledge the necessity of informing their audience about broad themes to encourage proactive financial planning.

“[00:36] Brian Preston: ...we typically don't like to cover anything until it comes through both sides of the legislative process... But we can express the fact that this still is only half baked.”

Bo Hanson introduces a framework for understanding tax returns, breaking them down into four sections: gross income, allowable deductions, tax calculations, and tax credits. This structure sets the stage for analyzing how the new bill may affect each component.

“[01:25] Bo Hanson: ...how do some of these tax changes, potential tax changes, hit each one of those sections?”

III. Detailed Breakdown of Tax Bill Changes

A. Gross Income Adjustments

Brian Preston touches on speculations around taxable income components, such as tips and Social Security benefits. However, he refrains from providing detailed analysis due to the bill's incomplete status.

“[02:22] Brian Preston: ...gross income. ...irty to see... but we didn't want to put any additional slides on this until we got the full details from the Senate once they get through the negotiations.”

B. Standard Deduction Enhancements

A significant focus is placed on the standard deduction, a cornerstone for the majority of taxpayers. Bo Hanson explains how the proposed bill aims to increase the standard deduction amounts, offering relief primarily to single individuals, married couples filing jointly, and seniors.

“[04:20] Bo Hanson: ...standard deduction will increase for single individuals from $15,000 to $16,000. For married filing jointly from $30,000 to $32,000. And seniors from an additional $2,000 to $4,000.”

Brian Preston underscores the importance of this change, noting that approximately 90% of taxpayers utilize the standard deduction.

“[03:48] Brian Preston: Now, look, we've pulled the stats. 90% of taxpayers actually use the standard deduction. So this is a big deal.”

He further explains that without the bill, the standard deduction is set to decrease significantly due to the expiration of previous tax legislation.

“[04:20] Brian Preston: ...if we don't bring back, make these changes permanent... it's actually this year.”

C. SALT Deduction Expansion

The State and Local Tax (SALT) deduction, which allows taxpayers to deduct certain state and local taxes, is another critical area of focus. The 2017 Tax Cuts and Jobs Act had capped SALT deductions at $10,000, impacting residents of high-tax states.

Bo Hanson discusses proposed expansions to this cap, which would temporarily increase it to $40,000, with a phase-out threshold for higher incomes.

“[05:53] Brian Preston: ...the SALT Deduction is going to get expanded to a degree.”

This change is poised to provide substantial relief to taxpayers in high-tax regions, though it remains contingent on final legislative negotiations.

D. Tax Brackets Adjustments

The proposed bill also addresses tax brackets, aiming to lock in current rates and potentially lower the highest marginal tax bracket from 39.6% to 37%. Bo Hanson reiterates that maintaining current tax rates would benefit a broad spectrum of taxpayers.

“[07:01] Bo Hanson: ...tax brackets are going to change... the highest marginal tax bracket is going to be capped at 37% as opposed to 39.6%.”

E. Child Tax Credit Modifications

One of the most impactful changes discussed is the alteration of the Child Tax Credit (CTC). The current proposal seeks to double the CTC from $1,000 to $2,000 per child, enhancing the financial support for families.

“[08:38] Brian Preston: ...it is a literal $2,000 reduction in the taxes you pay.”

However, this enhancement is positioned as a temporary measure, slated to phase out in 2028, with discussions around making it a permanent fixture ongoing.

“[09:57] Bo Hanson: ...these child tax credits now indexed for inflation after 2028, once they lose that sweetener on there.”

Brian Preston emphasizes the difference between tax credits and deductions, highlighting that credits offer a dollar-for-dollar reduction in tax liability, making them more impactful for eligible families.

“[09:57] Brian Preston: ...credits ... are not a deduction... a literal $2,000 reduction in the taxes you pay.”

IV. Preparing for the Tax Changes

Both hosts agree on the importance of proactive financial planning in anticipation of the new tax bill. They encourage listeners to familiarize themselves with the potential changes and consider how these may influence their personal financial strategies.

“[10:28] Bo Hanson: ...changes could be coming down the pipe and we want you to be prepared for them so that you can either plan for them or position yourself in such a way that you can take advantage of.”

Brian Preston reassures the audience that the Money Guy Show will provide detailed analyses once the bill is finalized, ensuring listeners stay informed and equipped to make informed financial decisions.

“[10:28] Brian Preston: ...we're going to give you the full details and ... get all into the nuts and bolts of this once we actually know what the real consolidated bill from both the Senate and the House.”

V. Listener Q&A Session

Following the tax bill discussion, Brian and Bo engage with their audience, addressing a series of financial questions submitted by listeners. This segment offers practical advice on various personal finance topics, enhancing the episode's value.

A. Balancing 401(k) Contributions and Emergency Funds

Question from Donald:
"I'm 31 and my employer has a 401(k) match at 50% up to the legal limit of $23,500. I'm currently maxing this out, but I do not have a fully funded emergency fund. Would you recommend reallocating?"
Brian Preston and Bo Hanson discuss the critical importance of maintaining an emergency fund, even when benefiting from generous employer matches. They emphasize that without an adequate emergency reserve, financial safety nets are compromised.

“[19:39] Brian Preston: ...you gotta have an emergency ... you're running a risk if you have a life emergency.”

Bo Hanson suggests creative strategies to balance both saving for retirement and building an emergency fund, such as temporarily reducing 401(k) contributions and supplementing with side income.

“[21:53] Brian Preston: ...if you can't fill up that emergency reserve, think you're just living way too far out.”

B. Managing High-Interest Credit Card Debt

Question from Still Mutating:
"My net worth is $450k, all tied up in our SoCal home. We have $15k in credit card debt at 19.75%. Should we use a HELOC at 6.75% to pay the credit card off? What should we do to get back on track?"
The hosts caution against swapping unsecured high-interest debt for secured debt like a Home Equity Line of Credit (HELOC), which puts the primary residence at risk if repayments falter.

“[30:16] Brian Preston: ...the easy button might have been addressing behavioral and discipline issues.”

Bo Hanson recommends addressing the root causes of high-interest debt through budgeting, cutting expenses, and possibly selling non-essential assets before considering debt consolidation methods that involve additional risks.

“[33:55] Bo Hanson: ...start selling stuff... make the hard discipline decisions...”

C. Maximizing Roth IRA Contributions Amid Income Limits

Question from Leo:
"My husband and I are over the income limit for Roth IRAs. Our account structure isn't ideal for Backdoor Roths. Aside from HSA, is there another way to fill that bucket? It feels like we're missing out."
Bo Hanson and Brian Preston explore alternative avenues for Roth contributions, such as Roth 401(k) or Roth 403(b) options available through employer plans. They also discuss the potential for future Roth conversions and strategic tax planning based on anticipated income levels.

“[40:33] Bo Hanson: ...Roth 401k or Roth 403b contributions.”

“[42:46] Brian Preston: ...if you think taxes are going to be higher in the future, then sometimes it makes sense to forego some opportunity costs ...”

VI. Conclusion

In wrapping up, Brian and Bo reinforce the significance of understanding legislative changes and their potential effects on personal finances. They assure listeners of their commitment to providing detailed analyses as more information becomes available and encourage proactive financial management.

“[66:45] Brian Preston: ...money is just a tool. It's not the goal. So make sure you're doing the why... live your best financial life.”

The episode serves as a valuable resource for individuals seeking clarity on upcoming tax legislation and practical financial guidance, underpinned by the hosts’ expertise and interactive engagement with their audience.

Notable Quotes:

• “[03:48] Brian Preston: Now, look, we've pulled the stats. 90% of taxpayers actually use the standard deduction. So this is a big deal.”

• “[09:57] Brian Preston: ...credits ... are not a deduction... a literal $2,000 reduction in the taxes you pay.”

• “[19:53] Brian Preston: ...you gotta have an emergency ... you're running a risk if you have a life emergency.”

• “[33:55] Bo Hanson: ...start selling stuff... make the hard discipline decisions...”

• “[66:45] Brian Preston: ...money is just a tool. It's not the goal. So make sure you're doing the why... live your best financial life.”

Resources Mentioned:

Listeners are encouraged to visit moneyguy.com for additional resources, including detailed guides, calculators, and the wealth multipliers tool mentioned during the discussion on emergency funds and retirement planning.

By dissecting the proposed tax bill and addressing listener queries with practical solutions, this episode of the Money Guy Show equips its audience with the knowledge and strategies necessary to navigate an evolving financial landscape confidently.