What’s Inside the New Tax Law? Key Permanent Changes for Individuals

As part of the most recent tax reform package, Congress has made several significant provisions of the 2017 Tax Cuts and Jobs Act (TCJA) permanent. Here's a breakdown of what you need to know:

Permanent Individual Tax Changes

Tax Brackets Stay Put

The 7-tier tax bracket structure introduced by the TCJA remains unchanged. The top marginal tax rate is still 37%, with a bottom rate of 10%. Note: Not all brackets will be indexed for inflation moving forward.

Mortgage Interest Deduction

Homeowners can continue to deduct interest on up to $750,000 in mortgage debt ($375,000 for single filers). This lower cap, established in 2017, is now permanent. Select mortgage insurance premiums may also be deductible.

Standard Deduction Expansion

The higher standard deduction -- originally doubled under TCJA -- has now been locked in. Beginning after 2025, it will increase to $15,750 for single filers and $31,500 for joint filers, with annual adjustments for inflation.

Gift & Estate Tax Exclusion Increases

The lifetime exemption is rising again. Starting in 2025, it will be:

• $15 million for single filers (up from $13.99M)

• $30 million for married couples (up from $27.98M)

  These thresholds will now be adjusted annually for inflation.

Child Tax Credit (CTC) Increase

The CTC will increase to $2,200 per qualifying child starting in tax year 2025, and the credit -- originally doubled under TCJA -- will now be a permanent fixture in the tax code.

No Return for Personal Exemptions

The personal exemption deduction, once a core component of the individual tax return, remains repealed. While individuals can no longer claim $4,050 per person, the expanded standard deduction and enhanced CTC help offset the loss.