On July 4, 2025, President Donald Trump signed a major tax and spending bill, commonly referred to as the “One Big Beautiful Bill Act” (OBBB Act), into law. The OBBB Act includes changes for employee benefit plans, including provisions that:
- Expand the availability of health savings accounts (HSAs);
- Permanently extend the telehealth exception for high deductible health plans (HDHPs);
- Increase the maximum annual limit for dependent care flexible spending accounts (FSAs);
- Allow employers to help pay employees’ student loans beyond 2025 and make cost-of-living adjustments to the tax exclusion for educational assistance programs; and
- Allow employers to contribute up to $2,500 per year to a new type of tax-advantaged account for children, called a “Trump Account.”
Click the following link to read the entire legal update: The “One Big Beautiful Bill Act” Includes Changes for Employee Benefits.
The “One Big Beautiful Bill Act” also includes a tax break for overtime and tips. Although the effective date for the change is January 1, 2025, the government has not yet announced any payroll processing changes that would immediately affect employees’ take-home pay. The IRS is expected to publish new information and guidelines, potentially including changes to the Form W-2. We will communicate updates as they are received.