Real Retiree Scenarios Under the Big Beautiful Bill

Over the past five blog posts, we’ve walked through how the One Big Beautiful Bill (OBBB) could affect retirees when it comes to tax brackets, Roth conversions, charitable giving, estate planning, and income-based benefits like Social Security and Medicare.

In this final post of the series, we’ll pull it all together through a few simplified retiree profiles—each showing how these changes might impact a real household, especially in high-cost areas like Massachusetts.

We’ll also include historical context where relevant, so you can clearly see what’s changed and why planning matters more than ever.

Historical Recap: What the Rules Looked Like Before

Federal estate tax exemption: $13.61M per person in 2024, set to drop to ~$7M in 2026.
Standard deduction: $14,600 (single) or $29,200 (joint with both spouses over 65), now rising to potentially $24,000 and $48,000 under OBBB.
Social Security taxation thresholds: Set in 1984 and never indexed—85% of benefits taxable above $44,000 (joint).
Medicare IRMAA surcharges: Begin above $194,000 (joint), also not indexed.
QCDs and Roth conversions: Previously smart planning tools—now even more valuable due to compressed brackets and fewer itemizers.

Profile #1: John and Nancy – Suburban Boston, Age 67

Assets: $2.5M (IRA, Roth IRA, home)
Income: $85,000 (IRA withdrawals + Social Security)

Before:

Took standard deduction, paid moderate tax on IRA withdrawals.
85% of Social Security was taxable.
No exposure to federal or MA estate taxes.

Under OBBB:

New $12,000 senior deduction lowers their AGI slightly.
Still in compressed middle brackets, but small Roth conversions now make more sense.
Their estate may grow beyond $2M MA threshold within 10–15 years; gifting or trusts now could reduce future taxes.

Profile #2: Linda – Jamaica Plain, Age 60

Assets: $3.2M (including inherited IRA and real estate)
Income: $120,000 (some rental, IRA distributions)

Before:

She planned to delay Roth conversions until RMD age (73).
No exposure to federal estate tax.

Under OBBB:

With brackets potentially rising and MA’s $2M estate threshold still in place, she’s now accelerating Roth conversions.
Real estate growth in Boston could push her estate over $7M by retirement—meaning federal estate tax could be an issue unless she acts.

Profile #3: David and Susan – Wellesley, Age 72

Assets: $6M (traditional IRAs, brokerage, home)
Income: $250,000 (RMDs, dividends, Social Security)

Before:

Were above IRMAA thresholds, paid $400+/month in Medicare surcharges.
Didn’t qualify for itemizing, so charitable gifts received no tax benefit.

Under OBBB:

Still paying IRMAA due to MAGI, but now using QCDs to fulfill RMDs tax-efficiently.
Opened donor-advised fund to “bunch” giving in high-income years.
Exploring trusts to prepare for 2026 estate exemption sunset.

Boston-Area Reality Check

What’s unique about retirees in Massachusetts and Boston-area suburbs is that they’re often:

Asset-rich due to decades of real estate appreciation
Holding large pre-tax balances from employer plans
Living in high-income zip codes that bump them into higher tax brackets, IRMAA, and estate exposure

That’s why seemingly modest retirees—on paper—may face disproportionately high taxes in retirement unless they plan early.

Final Thoughts: Bring It All Together

If you’ve followed along with this series, you now understand how the Big Beautiful Bill could reshape key pillars of retirement planning. Your strategy going forward should reflect:

Lower federal exemptions for estates
Higher standard deductions, but fewer itemized deductions
Tighter brackets that make timing of income more critical
Local estate thresholds and real estate trends in Massachusetts

The good news? You have time to act—but not forever. Smart, proactive planning now can help you navigate this changing environment and retire with clarity.

Evergreen Wealth Management provides flat-fee financial planning and investment management to individuals and families preparing for or living in retirement. Based in the Boston area, we specialize in helping clients create tax-efficient retirement income strategies that support the life they want to live.

The information contained herein is for educational purposes only and should not be construed as specific tax, legal, or investment advice. You should consult with a qualified tax professional or financial advisor before making decisions based on the content of this article. Evergreen Wealth Management is not a tax advisor or legal firm. All examples are hypothetical and intended for illustrative purposes only.