The 2025 Tax Cuts Shift Higher Savings to High-Income Households
WC
Willow Cromwell
SEC crypto enforcement · Apr 15, 2026
Source: DojiDoji Data Terminal
Most households will see a reduction in tax liability, but the largest percentage increases in savings will go to higher income people. This is the result of the One Big Beautiful Bill Act, signed by President Donald Trump on July 4, 2025.
Workers in tipped jobs now have a tax break on some tipped income through 2028. The law also provides a tax deduction for those eligible for overtime pay under the Fair Labor Standards Act.
Seniors aged 65 and older receive an additional $6,000 tax deduction through 2028. Because about half of Social Security recipients have incomes too low to owe federal taxes, the deduction primarily benefits middle and upper-income seniors. Those earning between $80,000 and $130,000 save roughly $1,100 per year.
Families with homeschooling children can now spend $10,000 per year per child tax-free from 529 education savings accounts. The law also establishes a $1,000 Treasury deposit for babies born between Jan. 1, 2025, and Dec. 31, 2028, to start a Trump Account.