Podcast Summary: The Practical Planner

Episode: Dive Into the One Big Beautiful Bill
Hosts: Thomas Kopelman & Dave
Date: November 4, 2025

Overview

This episode of The Practical Planner dives deep into the implications of the new federal tax bill—dubbed “the One Big Beautiful Bill”—with thorough analysis on how the changes impact estate planning and related strategies for both advisors and their clients. Rather than covering just headline changes, Thomas and Dave walk through the details, discuss how specific provisions affect different client profiles, and share practical takeaways for financial and estate advisors.

Key Discussion Points & Insights

1. Estate Planning: (00:59 – 05:11)

• Surprising Outcome: Estate tax exemption increased to $15 million per person (indexed for inflation).
  • This contrasts widespread expectations of a “Sunset” (i.e., reduced exemptions and more urgency to plan).
  • No loss of step-up in basis, grantor trusts, or discounted gifting—contrary to earlier proposals.
• "What’s Not in the Bill": "The biggest thing that's super interesting about this bill from an estate planning perspective is what's not in it." – Dave [01:12]
• Planning Implication: More runway for high-net-worth families. No immediate need to rush irreversible strategies.
  • “You have way too much money, use your gifting. If you’re younger and want liquidity, maybe don’t do as much.” – Thomas [03:47]
  • No environment change = a big change for planners who expected sunsetting policies.

2. SALT Cap Changes & Trust Structures (05:12 – 08:18)

• SALT Cap Increase: Raised deductible limit to $40,000 but phases out rapidly for incomes from $500–$600K.
  • Only benefits a narrow segment: “None of my high income earning clients get this at all.” – Thomas [06:19]
• Marriage Penalty & Trust Planning: For dual high earners, consider married filing separately. Each Irrevocable (especially non-grantor) trust can have its own SALT cap.
  • “You actually want the trust to be a different taxpayer so that it can take advantage of its own deductions…” – Dave [07:18]

3. QSBS Improvements (08:19 – 10:02)

• Major Surprise: Expanded Qualified Small Business Stock (QSBS) eligibility from $50M to $75M assets; exclusion up to $15M (was $10M), with pro-rated benefits after 3 and 4 years ownership.
  • After 3 years: 50% exemption; after 4: 75%; after 5: 100%.
  • Enhanced planning via trusts: “You can get 30 million between your name and one trust…” – Thomas [09:11]
• State-Specific Considerations: Watch how states treat non-grantor trusts; California remains unfriendly for QSBS, but changes focus on federal benefit.

4. Income Tax Brackets & Standard Deduction (10:03 – 12:57)

• Brackets Stay Low: Sunsetting threat averted; top bracket remains 37%, not reverted to 39.6%.
  • Standard deduction increased to $31,500, with an added $6,000 senior deduction (phase-outs apply).
• Implication for Roth Conversions: “It doesn't mean that Roth conversions… was a bad idea. It's just you have more time now.” – Dave [11:20]
  • Advisors should avoid trying to predict rates—focus on client-specific, time-sensitive withdrawals and conversions.

5. Business Owner Perks (12:58 – 15:38)

• Qualified Business Income (QBI) Deduction: Phaseout widened, but deduction itself unchanged; slight help for SSTBs (service businesses).
• Bonus Depreciation: Permanently set at 100%.
  • Highly favorable for farmers, real estate investors, and business owners.
  • “There can be really big tax benefits to this upfront deduction…” – Dave [13:53]
• Planning Point: Real estate professionals and high-income clients can use cost-segregation and rep status to turbocharge benefits.

6. 529 Plans & Trump Accounts (15:39 – 20:29)

• 529 Expansion: Broader definition of qualified expenses—now includes more K-12 (up to $20,000), professional certifications, and select post-secondary programs.
  • “It just keeps expanding and expanding…” – Dave [15:51]
• Trump Accounts: New, limited-time, child-focused retirement accounts ($5,000/year contributions by parents, $1,000 government match, 2024–2028 window).
  • Can be rolled into IRAs at 18; optimal with careful Roth conversion strategies during the child’s low-earning years.
  • “Now they have this head start of… easily $100k in Roth money before 30 without having to use a dollar of their own money.” – Thomas [19:32]
• Comparison: For most, 529s still superior for education savings; Trump accounts better as Roth-seeding vehicles for the wealthiest.

7. Other Key Individual Provisions (20:54 – 25:46)

• Above-the-line Deductions: New/expanded options regardless of itemizing, e.g. car loan interest (up to $10k for lower earners), charitable giving ($1,000/$2,000).
  • Charitable “Floor”: Now 0.5% of AGI required before itemized deduction allowed. Drives strategies like donor-advised fund lumping.
  • “You’re better off doing a donor-advised fund… and then take the standard in the other years.” – Thomas [22:43]
• No tax on tips/overtime: Not truly tax-free; rather, up to $25k can be deducted above-the-line for lower and middle incomes.
• Child Tax Credit: Increased to $2,200 and made permanent.
• Dependent Care FSA: Raised to $7,500.
• HSA and Opportunity Zones: Eligibility and benefits improved, particularly for rural communities.

Notable Quotes & Memorable Moments

• On the Unexpected Nature of Tax Reform:

  • “We thought things were going to sunset. They were absolutely certain because there was so much political gridlock. And look what happened.” – Dave [04:39]

• On Keeping Estate Planning Flexible:

  • “It’s just a promotion for why you should keep things flexible.” – Dave [04:39]

• On the Role of Advisors:

  • “The tax code is extremely long and it changes every two to four years. None of your clients understand what’s going on, let alone the changes. So the more you can stay ahead of it… the more you win in the eyes of your client.” – Thomas [25:31]

• On Charitable Planning:

  • “If you make $2 million, that’s your first 10k of charitable giving—you actually get no benefit…” – Thomas [22:43]

Important Timestamps

• Estate Tax Changes & What’s Not in the Bill: 00:59–05:11
• SALT Cap & Trust Strategies: 05:12–08:18
• QSBS Expansion & Planning: 08:19–10:02
• Brackets/Standard Deduction/Trust Taxes: 10:03–12:57
• Business-Owner Benefits (QBI, Depreciation): 12:58–15:38
• 529 Plan & Trump Accounts: 15:39–20:29
• Above-the-Line Deductions/Charitable/New Individual Credits: 20:54–25:46

Takeaways for Advisors

• The “big beautiful bill” mostly preserves today’s high exemption, low rate, opportunity-rich planning environment.
• Sophisticated trust and entity planning remain key for maximizing SALT, QSBS, and income tax benefits—watch for nuances and state overlays.
• Encourage flexibility and future-readiness; legislative environments change faster than most clients anticipate.
• Make clients aware of temporary opportunities (e.g., Trump accounts, new above-the-line deductions, etc.), and help them execute before windows close.

Tone: Practical, collaborative, detail-oriented; focused squarely on actionable advice.
Recommendation: Share this episode (and summary!) with any advisor seeking an all-in-one breakdown of the most sweeping tax changes and their direct application to financial planning.