Common Deductions and Allowances in OBBBA

Overview

OBBBA introduces several deductions and allowances that can reduce your taxable income. Key items include senior additional deduction, tip deduction, SALT deduction, car loan interest, and overtime treatment.

Our tool can help you quickly estimate how these deductions and allowances affect your taxes. Just enter your information, and we’ll show the potential impact.

For a detailed breakdown and examples, check out our full OBBBA guide:
👉 Read the complete OBBBA guide

FAQs

1. What is the senior additional deduction?
Eligible seniors can claim a deduction of $6,000 per person, reducing taxable income.
👉 Read more about Senior Additional Deduction

2. How does the tip deduction work?
Eligible tipped employees can deduct up to $25,000 of qualified tips and certain unreimbursed work-related expenses.
👉 Read more about Tip Deduction

3. What is the SALT deduction?
The State and Local Tax (SALT) deduction limit has increased to $40,000, allowing taxpayers to deduct more state and local taxes paid during the year.
👉 Read more about SALT Deduction

4. Can I deduct car loan interest?
Certain business-related car loan interest may be deductible up to $10,000 per year for qualifying vehicles.
👉 Read more about Car Loan Interest Deduction

5. How is overtime treated under OBBBA?
OBBBA includes rules on overtime income and related deductions: Single filers can deduct up to $12,500, and married couples filing jointly can deduct up to $25,000.
👉 Read more about Overtime Treatment

Tools and Resources

Quick Calculator
Estimate taxes quickly based on salary income only.
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Easy Calculator
Calculate taxes with salary income plus deductions or dependents.
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Advanced Calculator
Get a detailed tax estimate including salary income, business income, investments, deductions, or dependents.
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