Naming a trust as the beneficiary of an IRA results in several computations, starting with determining the payment period (i.e., does the trust qualify as a ‘see-through’ trust), then determining the required minimum distribution (RMD) amount for the year, and then following the RUPIA 90%-10% allocation, and finally allocating the IRA’s internal income when distributions are made from the trust. Best to add a provision to the trust, if it is expected to receive a large IRA, to specifically address the trustee’s allocation responsibilities and try to avoid some of the default provisions of the RUPIA.

The new Tax Act provides a new auto interest loan deduction, but how many borrowers will really benefit once all the law’s conditions are satisfied? The phaseout level starts at low amounts for individuals who are likely to be able to afford a new car. And as mentioned, given the price differential between new and used cars, the tax-savings of deducting loan interest will probably not be enough to justify purchasing a new car just to claim the interest deduction.

Some possible changes are afoot regarding 401(k) plans, including who is eligible to participate in the plan, and the prospect of opening 401(k) plans to private market investments.

The One Big Beautiful Bill Act (OBBBA) created a new deduction under the Tax Code called the senior deduction. The Act added IRC 151(d)(5) to the Tax Code. This deduction is up to $6,000 for individuals age 65 or older. The deduction is part of the Tax Code through 2028, unless Congress decides to extend it. This senior deduction starts to phase out for an individual when his/her income reached $75,000 (or $150,000 if married and filing jointly.)

The new limit on itemized deductions for those in high income tax brackets applies to estates and trusts. While a 2/37th reduction in deductible expenses does not seem like it is too big an impediment, when the expenses are large enough, especially with estate administration expenses, the loss of itemized deductions can be punitive.

A lot more planning in the years to come will include the use of non-grantor trusts to save income and capital gain taxes. At the same time, we can expect the IRS to assert more often IRC 643(f) so as to treat multiple non-grantor trusts as a single trust.

OBBBA provided a ‘mixed bag’ when it comes to philanthropy. It provides some incentives to charity giving, e.g., the opportunity for an above-the-line deduction for nonitemizers, but it also adds new floors, limits, and exclusions that will complicate planning and require greater attention to detail by donors and their advisors.

A recent missive summarized Trump Accounts created under the One Big Beautiful Bill Act, or OBBBA. As a quick refresher, a Trump Account can be created for a child who is born between 2025 and 2028. Up to $5,000 can be contributed to the Trump Account each year. If such an account is opened, the U.S. government will contribute $1,000 to it. In addition, employers can also contribute to that account, up to $2,500 annually, and that contribution will not be treated as taxable income to the employee.

Gambling losses just became even more costly under the One Big Beautiful Bill Act. This change complicates an already burdensome tracking process. Will this change provide new motivation to misreport or bypass official avenues of reporting? Will some gamblers now have an incentive to gamble at unlicensed international sites where there is minimal oversight and safeguards. This is just one of the many unintended consequences of the rushed-through OBBBA that we will watch be played out in the year(s) to come.

Now permanent applicable exclusion amount of $15 million per individual, new income tax deductions that can be phased out if the individual reports too large adjusted gross income, or the desire to shift income using non-grantor trusts for descendants in lower marginal income tax brackets, and a renewed focus on exposing trust assets to a basis step-up on the death of a surviving spouse.