Where OBBBA delivers the biggest tax cuts

After months of debate over President Donald Trump’s signing of the One Big Beautiful Bill Act (OBBBA), financial advisors and clients are finally feeling the impact this tax filing season.

New data from a non-profit, non-profit organization Tax Basis shows exactly how the changes will affect individual taxpayers across the country, providing the first detailed picture of the location and dollar impact of the law on housing and planning strategies.
Tax Foundation researchers analyzed the results of the OBBBA by first estimating national tax reforms using its standard estimation model. They then distributed those changes to states based on 2022 IRS data, showing how different taxpayers filed in each state.

Their approach invoked key provisions of the OBBBA, including the amendment itemized deductions, charitable contributions, standard deductions and moreallowing them to provide a detailed, state-by-state view of who benefits or pays more under the law.

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Nationally, the average tax cut per filer would be $3,813 in 2026, according to Tax Foundation data, driven by a combination of individual and corporate tax changes under the bill.

Individual tax changes, such as expanded deductions and credits, cost about $2,272 of that average reduction, while corporate tax provisions add about $1,541 per taxpayer. Tax Foundation researchers project that the average tax cut will drop to about $2,590 in 2030 as other deductions are phased out, then rise to about $3,163 in 2035 as inflation increases the value of permanent deductions.

Despite the broad benefits, regional disparities stand out. Taxpayers in Wyoming ($5,478), Washington ($5,445) and Massachusetts ($5,259) will see the largest average tax cuts in 2026, while filers in states like West Virginia ($2,448) and Mississippi ($2,386) will see the least.
Teton County, Wyoming, in particular, will receive a special abatement of $39,316 per taxpayer, the highest in the country, with Pitkin County, Colorado ($22,717) and Summit County, Utah ($15,477) following closely behind — likely reflecting the law’s benefit to high-income households and business owners in those areas. In contrast, more rural counties like Loup County, Nebraska (about $731) will see much smaller average cuts.

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According to the Tax Foundation, much of the proposed tax deferral comes from locking OBBBA into the individual income tax provisions of the Tax Cuts and Jobs Act of 2017. By making those rates, brackets and withholding rules permanent, the law prevents what would have been a tax increase for about 62% of filers by 2026, if the TCJA expires. In other words, a significant portion of the “cut” refers to avoiding higher taxes rather than introducing completely new breaks.

But the OBBBA also puts in extra help. The law creates new deductions for implied earnings and overtime payexpands the child tax credit and standard deduction, and makes business-friendly provisions like a 100% bonus deduction and full domestic research and development expenses forever.

The Tax Foundation’s analysis shows that both the individual and corporate sectors contribute meaningfully to the average reduction in tax liability.

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With average tax cuts that vary widely by region and income group, the Tax Foundation’s research underscores that a one-size-fits-all tax structure will not work well under the OBBBA. Where a client lives now plays a measurable role in how profitable they are, and that fact should shape discussions during this filing period and beyond.

That flexibility is particularly evident in state and local tax deductions. OBBBA for a while raises the SALT cap to $40,000 before returning to $10,000 after 2029, a change Garrett Watson, director of policy analysis at the Tax Foundation, said would affect taxpayers differently by location.

Clients in high-tax coastal areas are likely to feel the change most quickly. For those households, the timing of payment of government taxes, recognition of income and a decision to make compared to the claim that standard deductions can meaningfully change after-tax results.

High-income clients present another layer of complexity. While the law covers TCJA-era standards and expand the exemption of inheritance and giftsto reduce the threat of imminent tax increases, those same provisions may reshape long-term wealth transfer strategies. With less pressure to move assets for estate tax reasons, advisors may need to reevaluate how to give generouslyretirement income and inheritance goals are consistent under a stable rate structure.

On a practical level, OBBBA is now fully embedded in the planning environment. Advisers should reassess whether the asset placement remains profitable under the revised SALT, mortgage interest and capital gains deduction rules. Clients with limited or overtime income need accurate reporting to capture the new deductions, and high-net-worth families must revisit estate documents because of the expanded exemption. As several provisions are phased out or reset in the coming years, ongoing monitoring – rather than a one-time fix – will be necessary.