Permanent or temporary? Why the label changes your plans
In the new tax law, permanent means no end date, not unchangeable, and temporary means a last year is written in. That difference decides what you can plan around and what to use while it lasts.
Prepared by Prem Tax and Accounting Corp. Last reviewed November 6, 2026. Figures as of November 6, 2026.
Is this tax break permanent or temporary? The answer shapes what you do with it. Under the 2025 tax act many people call the One Big Beautiful Bill Act, which is Public Law 119-21, permanent just means no end date is written in. It never meant unchangeable. The Lasting-or-Leaving Pocket Card helps you question each rule. Our sorted table shows the labels.
- Permanent: the law names no last year. Examples: the rates, the standard deduction, the 199A business deduction and bonus depreciation.
- Temporary: a last year is written in. Seniors, tips, overtime and car-loan interest each get a deduction through tax year 2028. The raised cap on the state and local tax (SALT) deduction ends after 2029.
- Congress can and does amend: Public Law 119-108 (September 11, 2026) replaced the law's disaster-loss section.
What the label tells you
| Rule | Label | What it means for planning |
|---|---|---|
| Rates of 10% to 37% | Permanent | Plan several years out; bracket tops still move each year |
| Senior, tips, overtime, car loan | Temporary, last year 2028 | Use them while they last; do not build a plan that needs 2029 |
An invented example: the hidden rate
In 2026 a single retiree, age 66, has modified AGI (MAGI) of $84,000 and takes the standard deduction. Her senior deduction is $6,000 minus 6% of the $9,000 over $75,000, or $5,460. Taxable income is $84,000 minus $16,100, $2,050 and $5,460, or $60,390. She converts $12,000 from an IRA to a Roth IRA. MAGI becomes $96,000, the senior deduction falls to $4,740, and taxable income rises $12,720. At the 22% bracket that is $2,798.40 of tax, or 23.32% of the conversion. We ignored Social Security.
Planning points
- People who are 65 or older often consider estimating MAGI before December 31, because income between $75,000 and $175,000 (single) shrinks the senior deduction. The trap is a gain or a Roth conversion that costs more than its bracket suggests. Ask your adviser.
- People relying on a rule that ends in 2028 often consider their 2029 plan. The trap is a budget that counts on a deduction after its last year.
The Lasting-or-Leaving Pocket Card
- Does the rule have a last year, or none?
- If so, what must be true that year: age, income, vehicle?
- Does an income phase-out change the rate on my next dollar?
- Does Illinois, or my other state, follow it?
- When will I look again?
Common questions
Does permanent mean it can never change?
No. It means there is no end date. Amounts index, and Congress can amend a rule, as it did in September 2026.
Can the four deductions be extended past 2028?
Only Congress can. As of November 6, 2026, no law extends them. See our [sunset countdown](/current-topics/year-end-2027/sunset-countdown/).
Why is the SALT cap called temporary?
Only the higher cap ends, after 2029. The $10,000 cap that returns in 2030 has no end date.
Official sources
- Public Law 119-21 (enacted text)
- IRS: Schedule 1-A (Form 1040), 2025
- IRS: Revenue Procedure 2025-32
- Public Law 119-108 (enacted text)
- H.R. 7550, Permanent Tax Relief for Seniors Act (as introduced)
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