Where OBBBA delivers the biggest tax cuts

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

New data from the nonpartisan, nonprofit Tax Foundation shows exactly how the changes will affect individual taxpayers across the country, offering the first geographically detailed and dollar‑focused picture of the law’s implications for households and planning strategies.
The Tax Foundation researchers analyzed the effects of OBBBA by first estimating national tax changes using its general equilibrium model. They then distributed those changes to counties based on 2022 IRS data, which shows how different taxpayers filed in each area.

Their approach accounted for key OBBBA provisions, including adjustments to itemized deductions, charitable contributions, standard deductions and more, allowing them to provide a detailed, county-by-county view of who benefits or pays more under the law.

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

Individual tax changes, like expanded deductions and credits, account for about $2,272 of that average cut, while business tax provisions contribute roughly $1,541 per taxpayer. Tax Foundation researchers project that the average tax cut will dip to about $2,590 in 2030 as some deductions phase out, then rise again to around $3,163 by 2035 as inflation pushes the permanent provisions’ nominal value higher.

Despite broad benefits, geographic 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 such as West Virginia ($2,448) and Mississippi ($2,386) receive the smallest.
Teton County, Wyoming, in particular, will experience an exceptional $39,316 average cut per taxpayer, the highest in the country, with Pitkin County, Colorado ($22,717) and Summit County, Utah ($15,477) following closely — likely reflecting the law’s benefit to higher‑income households and business owners in those areas. By 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 projected tax relief stems from OBBBA locking in the individual income tax provisions of the 2017 Tax Cuts and Jobs Act. By making those rates, brackets and deduction rules permanent, the law prevents what would have been a tax increase for roughly 62% of filers in 2026, had the TCJA expired. In other words, a significant share of the “cut” reflects avoiding higher taxes rather than introducing entirely new breaks.

But OBBBA also layers on additional relief. The law creates new deductions for tipped income and overtime pay, expands the child tax credit and standard deduction, and makes business-friendly provisions such as 100% bonus depreciation and full expensing for domestic research and development permanent.

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

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With average tax cuts varying widely by geography and income group, the Tax Foundation’s research underscores that one-size-fits-all tax planning will be less effective under OBBBA. Where a client lives now plays a measurable role in how much they benefit, and that reality should shape conversations during this filing season and beyond.

That dynamic is especially evident in the state and local tax deduction. OBBBA temporarily raises the SALT cap to $40,000 before reverting to $10,000 after 2029, a shift that Garrett Watson, director of policy analysis at the Tax Foundation, said will affect taxpayers differently depending on location.

Clients in higher-tax coastal states are likely to feel the change most acutely. For those households, the timing of state tax payments, income recognition and the decision to itemize versus claim the standard deduction could meaningfully alter after-tax results.

Higher-income clients present another layer of complexity. While the law locks in TCJA-era rates and expands estate and gift exemptions, reducing the threat of a near-term tax hike, those same provisions may reshape long-term wealth-transfer strategies. With less pressure to move assets for estate tax reasons, advisors may need to recalibrate how charitable giving, retirement income and legacy goals align under a more stable rate structure.

At a practical level, OBBBA is now fully embedded in the planning environment. Advisors should reassess whether itemizing remains advantageous under revised SALT, mortgage interest and charitable deduction rules. Clients with tipped or overtime income need accurate reporting to capture new deductions, and high-net-worth families should revisit estate documents in light of expanded exemptions. As several provisions phase down or reset in the coming years, ongoing monitoring — rather than one-time adjustments — will be essential.