Study: Tax cuts from OBBB will vary widely by state and county

Accounting Today contributed to this report  

A new Tax Foundation study estimates that the One Big Beautiful Bill Act (OBBBA) will reduce federal taxes for individual taxpayers in every state, though the scale of savings will differ significantly across regions. 

By 2026, taxpayers in Wyoming ($5,375), Washington ($5,372), and Massachusetts ($5,139) are projected to receive the largest average tax cuts, while residents of West Virginia ($2,503) and Mississippi ($2,401) will see the smallest reductions. At the county level, wealthy resort communities are expected to benefit most. Teton County, Wyoming, is projected to lead the nation with an average $37,373 tax cut per filer, followed by Pitkin County, Colorado ($21,363), and Summit County, Utah ($14,537). In contrast, rural Loup County, Nebraska, will see an average cut of just $824. 

Nationally, the average tax cut per taxpayer is expected to be $3,752 in 2026. That figure will drop to about $2,505 in 2030, when provisions such as deductions for tips and overtime expire, before rising again to $3,301 in 2035 as inflation compounds permanent cuts. The $40,000 cap on state and local tax deductions—tightening to $10,000 after 2029—will also create sharper effects in high-tax coastal states. Over the long term, the Tax Foundation estimates the OBBBA will generate nearly 938,000 full-time equivalent jobs, led by California (132,000) and Texas (81,000). 

However, the benefits are not distributed evenly. The Congressional Budget Office found the poorest 10% of households will lose about $1,200 annually, a 3.1% hit to their incomes, largely due to cuts in Medicaid and SNAP. Meanwhile, the top 10% of earners are expected to see an average $13,600 gain, equal to a 2.7% income boost. A separate analysis from the Tax Policy Institute projects that about 85% of households will receive a tax cut in 2026, though that share will decline to around 70% by 2030, with roughly 10% of households facing tax increases by then. 

For more insight into the OBBB, be sure to join OSCPA for our upcoming One Big Beautiful Tax Webinar either this Oct. 31 or Dec. 1.  

If you missed our live OBBB webcast held on July 30, you can now access the full one-hour CPE session on-demand at your convenience.