Trump’s new tax law will benefit the rich, cost the poor, create demand for tax lawyers

A sweeping new tax and economic policy law will bring significant changes for U.S. taxpayers, though its complexity and the timing of its benefits raise questions, legal experts at UC Law San Francisco said during a recent discussion.

The 870-page One Big Beautiful Bill Act, signed July 4, includes reforms affecting families, workers, businesses and investors.

During a recent event, professors from the university’s Center on Tax Law broke down its wide-ranging provisions.

Co-director Heather Field explained the law creates new “Trump accounts,” investment vehicles for children that include a $1,000 federal starter deposit.

It also provides partial tax relief on tip and overtime income and a temporary deduction of up to $6,000 for seniors. Many benefits require a Social Security number, largely excluding noncitizens.

Field noted the law’s timing appears politically strategic.

Key individual tax breaks expire in 2028, after the next presidential election, while changes to withholding formulas were delayed to ensure larger tax refunds for voters ahead of the 2026 midterms.

Recent Internal Revenue Service budget cuts will further complicate the law’s rollout, Field added.

“There will be some real challenges in implementation,” she said. “A lot of work must be done by the IRS to provide new guidance, new forms and new regulations.”

Co-director Manoj Viswanathan said the law tilts benefits toward wealthier households, with Congressional Budget Office analysis indicating the bottom 10% of earners may see a net income loss.

Businesses secured major wins, including permanent deductions for research, development and capital investments. Investors also gained expanded incentives for small business stock, allowing tax-free gains of up to $15 million.

Despite its complexity, Viswanathan said the law ensures a strong demand for tax professionals.

“The fact that we have complicated provisions means that if you study tax, you often will get a job,” he said. “Tax lawyers are always going to be needed and useful.”