Key Upcoming US Tax Changes – What You Need to Know for 2025 and Beyond

Erik McCall
Jul 4
2 min read

At EDA, we keep a close eye on tax law changes so you don’t have to. Several important updates to US tax law are on the horizon, and it’s important to understand how these may affect your tax position, especially if you are a US expat, dual resident, or have international assets. Here’s a simple overview of the most significant changes expected over the next few years.

1. Extension of Key Tax Cuts from the 2017 TCJA

Many provisions from the 2017 Tax Cuts and Jobs Act (TCJA) were originally set to expire after 2025. The new legislation—referred to in some circles as the “One Big Beautiful Bill” (OBBB)—extends or modifies some of these provisions.

Key changes include:

• Lower income tax brackets: Expected to continue beyond 2025.

• Higher standard deductions: Remaining in place, which may reduce the need to itemise deductions.

• SALT deduction cap ($10,000): Set to stay unless further legislation is passed.

• Child Tax Credit: Potential increases in both the amount and refundability for lower-income households.

2. Inflation Adjustments

Tax brackets, the standard deduction, and retirement contribution limits will continue to be adjusted for inflation. This is important to consider when planning your income and investments in 2025 and beyond.

3. Temporary Tax Relief Measures

Some provisions may offer short-term relief, such as:

• Exclusions or reduced tax on certain types of overtime and tip income.

• Increases in the Earned Income Tax Credit (EITC) for low-to-moderate income earners.

These are aimed at supporting working households but may not apply every year.

What This Means for You

If you’re a US taxpayer living abroad or dealing with cross-border income and assets, here are a few things to keep in mind:

• Income planning: Make sure your income is structured tax efficiently—especially if you anticipate changes in your residency or employment.

• Deductions and credits: Be aware of eligibility, particularly if your income is split between jurisdictions.

• Long-term planning: The 2025/26 tax year will be a transition year for many. Now is a good time to review your financial position and consider proactive tax planning.

Need Help Navigating the Changes?

We’re here to help. Whether you need to adjust your withholding, evaluate your investment income, or ensure your deductions are optimised, our cross-border tax team can support you.