What the ‘Big, Beautiful Bill’ Means for Your Finances
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The GOP’s “big, beautiful bill” will impact people’s finances through tax provisions, cuts to social programs and diminished consumer protections.
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7 min read
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investment
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July 3, 2025
07:00 PM
NerdWallet
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Trump's “big, beautiful bill” has ed the finish line in Congress
Its visions are expected to dramatically reshape the financial s of millions of Americans and add trillions to an already-overflowing national debt
The Senate passed its version of the budget bill on Tuesday, and House Republicans apved the final package on Thursday by a vote of 218-214
Firmly walking the party line, the budget ders on many of President Donald Trump’s top policy goals
Trump is expected to sign the bill into law on July 4
The legislation extends 2017 tax cuts, strips health insurance from millions of Medicaid recipients, increases defense and immigration enforcement, raises the debt limit and weakens food assistance
Altogether, the bill adds an estimated $3. 3 trillion to the national debt over the next 10 years, according to an analysis by the Congressional Budget Office (CBO)
Among the hundreds of line items in the budget are a slew of measures that could shake up household finances for years to come
Here are the visions in the bill that will most directly affect Americans and the U
Tax cuts and credits The budget makes permanent the 2017 tax cuts implemented during the first Trump administration that were set to expire by the end of the year
It’s by far the most expensive item in the budget
An analysis by the CBO that looks through 2034 finds the wealthiest households will benefit most with an average $12,044 in savings per year; middle-income families would see average annual savings of $500 to $1,000 per year; while the lowest-income households would lose an average of $1,559 annually
Among the nearly 70 tax-related visions in the budget, here are the most notable for taxpayers, by how much money they'd cost the federal government or bring in as tax revenue
Measures that would reduce revenue for the federal government, according to the CBO: Standard deduction increases by $750 for individuals and $1,500 for couples in 2025, with annual inflation adjustments after that
Reduces revenue by an estimated $1,425 billion
Alternative minimum tax (AMT) exemption increases permanently, with changes to the income levels when the exemption phases out
Reduces revenue by $1,363 billion
Child Tax Credit increases permanently, to $2,200 in 2026
Reduces revenue by an estimated $817 billion
Estate and gift tax exemptions are permanently increased and ext
Reduces revenue by an estimated $212 billion
No tax on tips vision eliminates tips from taxable income for tax years 2025-2028
Reduces revenue by an estimated $32 billion
No tax on overtime pay for tax years 2025-2028
Reduces revenue by an estimated $90 billion
Interest on auto loans for new vehicles, up to $10,000, is excluded for tax years 2025-2028
Reduces revenue by an estimated $31 billion
Measures that would bring in money to the federal government:State and local tax (SALT) deduction cap increases to $40,000 for tax years 2025-2028
Increases revenue by an estimated $946 billion
The current limit of $10,000 is set to expire at the end of the year, so without a new cap, taxpayers could deduct an unlimited amount from their federal taxes and the government would collect less revenue
New deductions for seniors up to $6,000 for tax years 2025-2028
Increases revenue by an estimated $1,807 billion
Residential clean energy tax credit ends after 2025
That means owners can’t claim a tax credit for roof top solar, geothermal heat pumps or other green energy devices
Increases revenue by an estimated $77 billion
The bill also creates a new type of investment account for children, dubbed “Trump accounts,” that parents can pay into
The federal government will contribute $1,000 to each new account
The gram would cost $15 billion, according to the CBO
The budget also closes a loophole that exempts small packages from tariffs, which could increase the costs consumers pay
The tax changes add up to $4. 5 trillion in total cuts over 10 years, according to CBO estimates
Social safety netsTo offset some of the bill’s costs, Republicans marked deep cuts to social grams, including $930 billion in cuts over the next 10 years to Medicaid, Medicare and the Affordable Care Act (ACA), the CBO finds
Currently, 71 million Americans are enrolled in Medicaid and more than 45 million Americans have health coverage through the ACA, according to government data
Driving the Medicaid cuts is a new national work requirement for childless adults without disabilities and for parents with children ages 15 and up
To qualify for Medicaid, they must show they worked, volunteered or att school at least 80 hours the month before signing up
Eligibility rules will also tighten, requiring states to check recipient eligibility every six months
An estimated 11. 8 million more people will be uninsured by 2034 due to the Medicaid cuts, the CBO finds
Further cuts and changes to health care grams the ACA could push that amount millions higher
The bill also affects those who receive food assistance through the Supplemental Nutrition Assistance gram (SNAP)
To reduce federal spending, the bill tightens eligibility, expands work requirements and shifts costs to states
Consumer tections The budget includes funding cuts that could undermine consumer financial tections and limit access to student loan relief
Funding for the Consumer Financial tection Bureau (CFPB) — the government watchdog that the Trump Administration has targeted for dismantling — will be cut in half
The agency oversees the consumer financial industry and has secured more than $21 billion in refunds and relief for more than 200 million consumers
With fewer dollars, the CFPB may be less able to assist consumers
Federal student loan borrowers will also feel the impact
The bill replaces existing repayment plans and extends the timeline for forgiveness
It also eliminates funding for the Graduate PLUS gram and caps the lifetime amount a graduate student can borrow
National debt and the economy The Tax Foundation jects that the budget will temporarily boost economic growth by encouraging investment through tax cuts
But it comes at a steep price: The national debt, which currently stands at more than $36 trillion, would increase by an additional $3 trillion over the next decade as a result of the bill, according to the CBO
The biggest costs in the budget are taxes, ed by $1 trillion allocated for defense, as well as border security and immigration enforcement — core priorities for Trump
The budget for that agenda includes some $45 billion for the U. -Mexico border wall and $45 billion for immigration detention facilities
The bill’s rollbacks of green energy incentives could hike energy costs for consumers, slow clean energy development and increase greenhouse gas emissions
Estimates by the Center for Climate and Energy Solutions says the rollbacks could also lead to job losses and slower economic growth
One critical component in the budget is a $5 trillion increase to the debt ceiling, which will prevent the U
From running out of money to meet its debt obligations
Before the bill’s passage, the government was headed for a potential default this summer. (Photo by Andrew Harnik/Getty Images News via Getty Images) the authorAnna HelhoskiAnna Helhoski is a senior writer/content strategist covering economic news, policy and trends
Her work has been syndicated in national news outlets including The Associated Press, The New York Times, The Washington Post and USA Today
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