The “Big, Beautiful Bill,” Part 2: Student Loans, SALT, 1099s, and More

Please Note: This is Part 2 of our coverage on the “One Big, Beautiful Bill” (OBBB). Part 1 covers the higher-level, bigger-ticket items (tax brackets, the larger standard deduction, QBI, the estate/gift exemption, plus the temporary add-ons like the senior deduction, tip/overtime relief, auto-loan interest, Medicaid/529/HSA updates). If you’re looking for that information, please check out Part 1 here.

Student Loans

Repayment Assistance Plan (RAP) and PSLF (why they matter): Beginning July 1, 2026, the RAP becomes the only income-driven repayment option for new federal student loans. If you’re working toward Public Service Loan Forgiveness (PSLF)—which wipes out any remaining debt after a decade of eligible public service—RAP has now become the mandatory repayment track to qualify. The plan changes how payments are calculated, how long repayment can last, and who can access forgiveness. Moreover, here are some other things you should know:1

• Repayment Term: Loans repaid under RAP extend up to 30 years before any automatic cancellation, unless forgiven sooner through PSLF.
• Payment Formula by Income:
  • $0–$10,000: Flat $10 monthly payment.
  • $10,001–$20,000: 1% of adjusted gross income (AGI).
  • $20,001–$30,000: 2% of AGI.
  • $30,001–$40,000: 3% of AGI.
  • $40,001–$50,000: 4% of AGI.
  • $50,001–$60,000: 5% of AGI.
  • $60,001–$70,000: 6% of AGI.
  • $70,001–$80,000: 7% of AGI.
  • $80,001–$90,000: 8% of AGI.
  • $90,001–$100,000: 9% of AGI.
  • $100,001 and above: 10% of AGI.
• Family Adjustment: Each dependent child reduces your monthly bill by $50, though other household members don’t count toward this reduction.
• No Ballooning Interest: Unpaid interest doesn’t compound, so balances stay stable even if required payments are low.
• Eligibility Limits: RAP covers federal direct loans and graduate PLUS loans, but parent PLUS borrowers are excluded.

The elimination of Grad PLUS loans: Graduate PLUS loans let graduate and professional students borrow up to the full cost of attendance, making them a lifeline for expensive programs like law, medicine, and business. After mid-2026, this option ends, forcing students to look to alternatives such as tuition discounts, employer benefits, private loans, or savings. The bill raises borrowing caps on Direct Unsubsidized Loans, but the new limits are lower than the open-ended borrowing Grad PLUS once allowed.2

New borrowing limits: For decades, graduate students and parents of undergraduates could borrow essentially unlimited amounts. The OBBB changes this system by introducing firm caps on annual and lifetime borrowing. Here’s how the new structure compares:3

• Undergraduate Students: No change. Loan limits remain $5,500 to $12,500 annually and $31,000 to $57,500 in aggregate, depending on class level and dependency status.
• Nonprofessional Graduate Students (master’s, PhD, etc.): In the past, graduate students could take out loans covering the entire school-defined cost of attendance. Under OBBB, borrowing is capped at $20,500 annually and $100,000 total over the course of study.
• Professional Graduate Students (law, medicine, dentistry, theology, etc.): Also previously able to borrow up to cost of attendance. OBBB now sets limits at $50,000 per year and $200,000 total.

Parents of Undergraduates (Parent PLUS Loans): Parents used to be able borrow the full school-calculated cost of attendance for each child, even without proof they could manage the debt. OBBB reduces this to $20,000 annually per child and a lifetime limit of $65,000 per child.

Opportunity Zones 

What Opportunity Zones (OZs) are: These are federally designated areas—often low-income or economically distressed communities—created to encourage private investment where it’s most needed. By putting capital gains into a qualified OZ fund, investors can delay paying taxes on the original gain and, if they hold the investment long enough, avoid taxes on any new appreciation that builds inside the fund.

OBBB’s Impact on Opportunity Zones: The One Big Beautiful Bill makes Opportunity Zones a permanent program, replacing the old 2026 sunset with rolling 10-year designations that refresh over time. It also raises the bar for what qualifies as a low-income community, eliminates looser contiguous-tract rules, introduces a new 5-year deferral schedule, and creates special incentives for rural zones—all changes designed to bring more discipline and direct investment toward the communities most in need.4

What it means for investors: For investors, the new rules mean you can approach Opportunity Zone projects with more certainty and flexibility. The program is now permanent, so there’s no looming deadline to rush deals, and each zone will run on a 10-year cycle, giving you a clearer window to plan. The updated tax rules still offer meaningful incentives, but with stricter guardrails.

1099 Updates

1099-K (payment apps and online marketplaces): The threshold reverts to its long-standing level of $20,000 and 200 transactions. That means casual users of PayPal, Venmo, or marketplace platforms won’t be hit with surprise tax forms for small amounts. Business receipts from goods or services still count, but everyday personal transfers remain outside 1099-K reporting.5

1099-NEC / 1099-MISC (contractors, prizes, rent, and more): The reporting floor rises from $600 to $2,000 starting in 2026, with automatic inflation adjustments from 2027 onward. This change eases paperwork for payors who make smaller, one-off payments, though businesses and freelancers still need to track earnings carefully since income over $400 remains taxable even without a form in hand.6

The State and Local Tax (SALT) Window

What the window is: The cap on the state and local tax (SALT) deduction rises to $40,000 with modest indexing (1%) through 2029, then reverts to $10,000 in 2030. Very high earners see a phased reduction of the benefit. This is what that phased reduction out looks like:7

• Phaseout begins: Starting in 2025, taxpayers with modified adjusted gross income (MAGI) above $500,000 begin to see their SALT deduction scaled back.
• Rising cutoff: The income trigger moves up to $505,000 in 2026 and will automatically climb by 1% each year after.
• Formula for reduction: For each dollar earned past the threshold, the available deduction is trimmed by 30 cents.
• Floor in place: No matter how high your income, you’ll always be able to claim at least a $10,000 deduction.

How bunching works: Concentrate charitable gifts and other itemized deductions in the same calendar year (often via a donor-advised fund) so your itemized total clears the standard deduction and lets you actually use more of the expanded SALT room during the window.

Property-tax timing: Real-estate taxes are generally deductible in the year they’re paid and already assessed. If your locality allows, you can time one or more payments so they fall inside SALT-friendly years—just confirm the bill has been issued and prepayments are permitted.

Alternative Minimum Tax (AMT) watch-outs: SALT isn’t deductible under AMT. If AMT applies in your target year, bunching or prepaying state/local taxes won’t move the needle. Run projections first to see whether AMT wipes out the benefit.

PTET note (separate lever): In states with a pass-through entity tax (PTET) election, owners can shift personal state income tax to the entity level, where it’s generally deductible by the business. This is distinct from the personal SALT cap and can help even when your individual SALT deduction is maxed.

Accelerated Depreciation

Permanent 100% Bonus Depreciation: Under the OBBB, companies can permanently write off the entire cost of qualifying assets that begin service after January 19, 2025. Instead of the gradual phase-down under the Tax Cuts and Jobs Act—which would have dropped the deduction to 40% in 2025 and eliminated it by 2027—businesses can now permanently deduct 100% of the cost in the first year. The provision covers a wide range of tangible property with a lifespan of 20 years or less, and it also extends to qualifying used equipment. For companies, this translates into faster tax savings, improved cash flow, and greater certainty when planning large purchases such as machinery, vehicles, or building improvements.8

Section 179 expansion: Section 179 is what allows certain businesses to immediately deduct the cost of qualifying assets in the year they are purchased. Under this new legislation, the annual Section 179 cap doubles to $2.5 million, with the deduction starting to phase out once total purchases exceed $4 million (and it completely phases out after $6.5 million). Here’s a breakdown of the new phaseouts:9

• $4,000,000 in purchases → $2,500,000 deduction
• $4,500,000 in purchases → $2,000,000 deduction
• $5,000,000 in purchases → $1,500,000 deduction
• $5,500,000 in purchases → $1,000,000 deduction
• $6,000,000 in purchases → $500,000 deduction
• $6,500,000 in purchases → $0 deduction

New rule for production facilities: The law not only brings back 100% bonus depreciation for assets placed in service after January 19, 2025, but also introduces an optional §168(n) deduction, which applies to nonresidential property tied to manufacturing, agriculture, refining activities, or chemical production. Projects must begin between January 19, 2025, and January 1, 2029, and be in service by 2030. Some portions of buildings don’t qualify depending on what the areas are used for (e.g. office space, engineering, sales, research, parking, and administrative functions). Disposing of the property within 10 years also triggers specific recapture rules.10

Stablecoins

What stablecoins are: Stablecoins are digital tokens designed to hold a steady price, typically pegged to the value of the US dollar. This stability makes them practical for payments, settlements, and transfers, unlike cryptocurrencies that fluctuate widely in price.

The GENIUS Act: The GENIUS Act is the first federal law to establish a regulatory framework for payment stablecoins, passed shortly after the One Big Beautiful Bill (OBBB). While the OBBB deals with tax and fiscal measures, the GENIUS Act separately regulates stablecoins, and the two are often discussed together because they were enacted around the same time.

Who can issue stablecoins: Under the GENIUS Act, only banks and credit unions (including through subsidiaries) or approved nonbank financial firms can issue payment stablecoins. Nonbank issuers must meet federal or state regulatory standards, and larger issuers fall under federal oversight to ensure they meet reserve and compliance requirements.11 

How they’re backed: Stablecoin issuers must hold 1:1 reserves. Those reserves must be held in safer assets—such as cash, Treasury bills, or repurchase agreements—provided that each type of holding has been approved by federal regulators.12 

Why households and businesses might care: The GENIUS Act makes payment stablecoins more practical by requiring full reserves, disclosures, and oversight. That could lower costs for remittances, marketplace payouts, and B2B transactions—especially across platforms or borders. Still, they aren’t legal tender, not federally insured, and don’t pay interest. Holders do gain priority claims on reserves if an issuer fails, which offers protection but also brings heavier compliance duties for issuers.13

Final Thoughts: What Should You Be Doing Now?

While many of these provisions won’t take effect until January 1, 2026, now is the time to evaluate how they’ll shape your tax strategy going forward. Even the temporary measures, like the expanded SALT caps, could present planning opportunities over the next few years.

If you want a clearer picture of what these changes mean for you, we’re here to walk you through it. Schedule a complimentary consultation, and together we can review the provisions most relevant to you, answer your questions, and outline practical steps for the years ahead.

Snowpine Wealth Strategies does not provide legal or tax advice. You should consult a legal or tax professional regarding your individual situation.

Resources: 

1. https://www.nerdwallet.com/article/loans/student-loans/what-is-the-new-repayment-assistance-plan-rap-for-student-loans
2. https://www.ascentfunding.com/blog/how-big-beautiful-bill-impacts-grad-student-loans/#:~:text=The%20End%20of%20Grad%20PLUS,New%20Borrowing%20Caps
3. https://www.aei.org/research-products/report/an-analysis-of-the-one-big-beautiful-bill-acts-effect-on-student-loans/#scrollSection2
4. https://www.jw.com/news/insights-obbba-qualified-opportunity-zones/#:~:text=Under%20the%20One%20Big%20Beautiful,permanent%20by%20extending%20it%20indefinitely
5. https://www.bankrate.com/taxes/1099-k-tax-rules-what-you-need-to-know-if-you-get-paid-via-venmo-cash-app-or-paypal/#reporting-thresholds
6. https://www.avalara.com/blog/en/north-america/2025/07/one-big-beautiful-bill-act-1099-reporting-threshold.html#:~:text=The%20One%20Big%20Beautiful%20Bill%20Act%20returns%20the%201099%2DK,NEC%20reporting%20thresholds%20to%20$2%2C000
7. https://tax.thomsonreuters.com/blog/how-the-one-big-beautiful-bill-reshapes-salt-planning/
8. https://www.grantthornton.com/insights/alerts/tax/2025/insights/obbba-offers-new-ways-to-accelerate-depreciation?utm_source=chatgpt.com
9. https://bipartisanpolicy.org/explainer/the-2025-tax-debate-section-179-expensing-for-small-businesses/
10. https://www.bdo.com/insights/industries/manufacturing/incentivizing-production-what-the-obbba-means-for-manufacturing?utm_source=chatgpt.com
11. https://www.congress.gov/crs-product/IN12553
12. https://www.weforum.org/stories/2025/07/stablecoin-regulation-genius-act/
13. https://www.arnoldporter.com/en/perspectives/advisories/2025/07/new-stablecoin-legislation-analyzing-the-genius-act