The OBBB makes the nearly doubled standard deduction from the Tax Cuts and Jobs Act (TCJA) permanent. Without this law, the standard deduction would have been dramatically reduced back to pre-TCJA levels (with inflation adjustments).

Additionally, for 2025, the OBBBA increases the standard deduction by 5% across the board to $15,750 for single filers, $23,625 for heads of household and $31,500 for MFJ. These enhanced amounts will be the base for future annual inflation adjustments.

As part of making the increased standard deduction permanent, the law permanently repeals the personal exemption allowance that was part of tax calculations prior to 2018. This is a benefit to the vast majority of taxpayers.