by Greg Carnes, PhD, CPA, and Suzanne Youngberg, MST, CPA
Signed into law July 4, 2025, the One Big Beautiful Bill Act (OBBBA)1 is a federal statute that introduces various changes to the Internal Revenue Code (IRC), affecting both individual and business taxpayers. For CPA candidates, many of these tax policy provisions are expected to be tested on both the Taxation and Regulation (REG) and the Tax Compliance and Planning (TCP) sections of the CPA Exam. Before reaching for your prep books, read on to learn what's changing and, just as importantly, when those changes become testable.
Testing Before July 1, 2026
If you're planning to sit for REG or TCP before July 1, 2026, you're in the clear. Why? Because OBBBA provisions won't be tested until then. This means you will not be tested on these changes if:
- You sit for REG from now through June 30, 2026.
- You sit for TCP in the first month of the first two quarters in 2026 (Jan. 1-31 or April 1-30).
On the CPA Exam, tax law updates don't roll in gradually. Content is tied to specific testing cutoffs, which is why your exam date determines which rules apply.
Testing After July 1, 2026
Let's talk about what this looks like if you're testing later. If you haven't yet taken REG or TCP by June 30, 2026, you'll need to know the changes introduced by the OBBBA, as the OBBBA provisions are testable on the CPA Exam after this date.
Must-Know OBBBA Provisions for REG and TCP
So, what exactly is changing on the CPA Exam?
We recommend you review the following OBBBA provisions and have them down pat before test day if you are taking REG or TCP on or after July 1, 2026:
| OBBBA Provisions2 | ||||||
|---|---|---|---|---|---|---|
| 2026 Tax Law Tested as of July 1, 2026 | ||||||
| Standard deduction increased to $16,100 for single filers and married filing separately; $32,200 for married filing jointly; and $24,150 for head of household | Child Tax Credit set at $2,200 per child, of which $1,700 is refundable | Immediate expensing of domestic research and experimentation costs | ||||
| Section 179 expensing increased to $2.56 million, with a $4.09 million phaseout threshold | State and local income tax cap increased to $40,400; reverts to $10,000 in 2030 | Partially refundable adoption credit | ||||
| Section 163(j) interest limitation based on Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) | Permanent, 100% Bonus Depreciation for qualifying property placed in service on or after Jan. 20, 2025 | New qualification requirements for Section 1202 Qualified Small Business Stock | ||||
| Terminated Clean Vehicle Credit, Previously Owned Clean Vehicle Credit, Energy-Efficient Home Credit, and Residential Clean Energy Credit | Changes to the computation of the Child and Dependent Care Credit | 90% of gambling losses are deductible, but limited to the amount of gambling winnings. | ||||
| Tax-free benefit of employer-provided dependent care expenses increased to $7,500 | Changes to the computation of the Alternative Minimum Tax (AMT) exemption amount for individuals | Reporting threshold for 1099-NEC and 1099-MISC increased to $2,000 | ||||
| Tax-deferred Trump Savings Accounts for children under 18; contributions to the account are permitted until the year the child turns 18 | Disallowed charitable contributions for itemizers to the extent of .5% of AGI; and added $1,000 for AGI charitable contribution deduction for non-itemizers | Qualifying 529 Plan expenses expanded to include broader coverage for K-12, homeschool, and credentialing programs (e.g., CPA Exam review course fees) | ||||
| Temporary, 100% Bonus Depreciation for Qualified Production Property, namely a special type of non-residential property used for a qualified production activity within the United States | Qualified Business Income (QBI) deduction phase-out ranges increased | Estate and Gift Tax exemption increased to $15 million per individual | ||||
| Added phaseout of itemized deductions for higher-income individuals | ||||||
| Effective for Tax Years 2025-2028 | ||||||
| $6,000 Senior Deduction for taxpayers aged 65+ | $12,500 Overtime Pay Deduction; $25,000 for married filing jointly | $10,000 Auto Loan Interest Deductible for new, U.S.-assembled vehicles | ||||
| $25,000 Deduction for Tips | ||||||
| Items Remaining Primarily the same Before and After OBBBA | ||||||
| Individual tax rates remain at 10%, 12%, 22%, 24%, 32%, 35%, and 37% | Moving expense deduction disallowed (exception for active-duty military; and certain members of the intelligence community as of 2026) | 2% miscellaneous itemized deductions are no longer allowed | ||||
| Personal exemptions not deductible | Excess Business Losses (EBL) not deductible | Employer payments of student loans excluded from income up to $5,250 | ||||
| Credit for paid Family and Medical Leave made permanent | ||||||
Bottom Line: Sit for REG or TCP Before July 1, 2026
UWorld Supports You Before and After OBBBA Transition
UWorld will update its CPA Review content starting in spring 2026 to reflect testable changes due to OBBBA provisions.
Whether you test before or after the transition, our goal remains the same: to help you prepare for the CPA Exam using the version of tax law that applies to your exam date, without having to sort through those changes on your own.
How to Study with or without the Changes
Whether you sit for REG or TCP before or after July 1, 2026, your study approach should reflect what's changing and when those changes become testable. As one of the more substantial updates to U.S. tax law in recent years, OBBBA makes understanding the difference between effective dates and testable content crucial as the CPA Exam evolves.
More specifically, you will benefit from resources that help you:
- Study concepts that are testable based on your REG or TCP test dates
- Apply testable tax law through exam-style questions and practice sets
- Organize and reinforce key concepts as rules and thresholds change
Our CPA Review Course supports exam preparation by aligning content to the tax laws and exam requirements that are currently testable. That way, your preparation stays predictable and focused, rather than influenced by speculation about future testing changes.
You're Headed for CPA Success in 2026
Accounting is an ever-changing field. CPAs must be quick on their feet to keep pace with industry changes. Navigating OBBBA changes during the exam process reflects that same professional reality. Handle it with flexibility and discipline, and you'll be well on your way to becoming a CPA.
Frequently Asked Questions (FAQs)
Yes. However, none of the One Big Beautiful Bill Act (OBBBA) provisions will be tested on the CPA Exam until July 1, 2026, or later.
No. If you sit for REG any time through June 30, 2026, the exam will continue to test pre-OBBBA tax law.
No. TCP candidates won’t need to know OBBBA content if they test during the eligible windows before July 1, 2026:
- Jan. 1-31, 2026
- April 1-30, 2026
During these windows, TCP will still test the pre-OBBBA tax law.
OBBBA impacts tax-related content so it is relevant to REG and TCP. Other CPA Exam sections are not directly affected.
Yes. UWorld is actively updating course materials to reflect OBBBA changes as they become testable. There will be a transition period, but candidates will have access to updated content as exam requirements evolve.Â
Focus on mastering pre-OBBBA tax law and follow a structured study plan aligned with your test date. Tools such as dynamic study planners, expert-crafted Question Banks (QBanks), smart flashcards for spaced repetition, and digital notebooks can help you stay efficient and confident.
UWorld CPA Content Developer
UWorld CPA Content Developer
References
- AICPA & CIMA. (n.d.). Effective dates of tax provisions in H.R. 1: The One Big Beautiful Bill Act. https://www.aicpa-cima.com/resources/download/effective-dates-of-tax-provisions-in-h-r-1-the-one-big-beautiful-bill-act
- Internal Revenue Service. (n.d.). One Big Beautiful Bill provisions. https://www.irs.gov/newsroom/one-big-beautiful-bill-provisions
