What Does the Big Beautiful Bill Include?

What Does the Big Beautiful Bill Include? The “One Big Beautiful Bill Act” (OBBBA), often referred to as the Big Beautiful Bill, is a massive piece of legislation that’s been making waves in the U.S. Congress in 2025. Championed by Republicans and tied closely to President Donald Trump’s second-term agenda, this budget reconciliation bill is a sprawling, 900-page-plus package that touches nearly every corner of federal fiscal policy. From tax cuts to healthcare reforms, border security to energy policy, the bill aims to cement an “America First” agenda. But what exactly is in it, and what does it mean for everyday Americans? Let’s break it down in a way that feels human, clear, and grounded.

A Sweeping Tax Overhaul

At its core, the Big Beautiful Bill seeks to make permanent the 2017 Tax Cuts and Jobs Act (TCJA), which is set to expire at the end of 2025. This means maintaining lower tax rates and brackets for individuals and businesses, preventing what supporters call a potential $4 trillion tax hike. The bill also introduces new tax breaks, including some of Trump’s campaign promises:

• No Tax on Tips and Overtime: For tax years 2025 to 2028, workers earning less than $160,000 (or $300,000 for joint filers in the Senate version) can deduct tips and overtime pay from their federal income tax. This is a boon for service industry workers and hourly employees, though you’ll need a Social Security number to qualify.
• Increased Standard Deduction: The bill keeps the TCJA’s higher standard deduction and adds a temporary boost for seniors. Those 65 and older get an extra $4,000 (House version) or $6,000 (Senate version) deduction, phasing out for higher earners.
• State and Local Tax (SALT) Deduction: The SALT cap, currently at $10,000, would jump to $40,000 for married couples earning up to $500,000, a win for residents in high-tax states like New York and California.
• Child Tax Credit: The credit rises from $2,000 to $2,200 or $2,500, depending on the version, though lower-income families may not qualify for the full amount.
• Trump Accounts: A new tax-advantaged savings account for kids born between 2024 and 2028, seeded with a $1,000 federal deposit. Parents can add up to $5,000 annually, with earnings growing tax-deferred for education, job training, or home purchases.

Businesses aren’t left out either. The bill makes the TCJA’s 20% pass-through deduction permanent, bumps it to 23%, and allows immediate write-offs for equipment and research costs. It also tweaks global tax rules to encourage U.S.-based investment.

Healthcare and Welfare Reforms

The OBBBA takes a hard stance on social programs, aiming to curb spending and tighten eligibility. This has sparked heated debate, with critics warning of harm to vulnerable groups and supporters arguing it roots out waste.

• Medicaid Changes: The bill introduces work requirements for able-bodied adults, more frequent eligibility checks (every six months instead of annually), and co-pays for those above the federal poverty level. It also lowers provider taxes, which could strain state budgets, though a $50 billion rural hospital fund aims to soften the blow. Estimates suggest millions could lose coverage due to these changes.
• SNAP (Food Stamps): The Supplemental Nutrition Assistance Program faces cuts and new work requirements for childless adults without disabilities (80 hours per month starting in 2026). States must cover 5% to 15% of costs if error rates are high, potentially leading to reduced benefits in some areas.

Supporters say these reforms ensure programs serve their intended recipients—pregnant women, children, seniors, and the disabled—while cutting fraud. Critics, including the Center on Budget and Policy Priorities, estimate 8 million could lose SNAP benefits and 10.6 million might lose Medicaid.

Border Security and Immigration

The bill allocates significant funds to Trump’s border security agenda, reflecting his campaign focus on immigration enforcement:

• Border Wall and ICE: Over $46 billion for border wall construction and $45 billion for 100,000 new migrant detention beds. Another $14 billion supports deportation operations, with $10,000 bonuses for new ICE and Border Patrol agents.
• Asylum Fees: A minimum $100 fee for asylum seekers, down from a rejected $1,000 proposal.

These measures aim to fund the largest mass deportation operation in U.S. history, a cornerstone of Trump’s platform.

Energy and Defense

The OBBBA scales back Biden-era clean energy initiatives while boosting traditional energy and military spending:

• Energy Policy: It phases out tax credits for electric vehicles (by September 2025), EV charging stations (by June 2026), and wind/solar projects (post-2027). Biofuel credits, however, are extended to 2031. The bill also opens federal lands for oil, gas, and coal leasing.
• Defense Spending: An additional $150 billion goes to defense, including $20 billion for munitions, $12 billion for nuclear modernization, and $9 billion for servicemember quality-of-life improvements. A $25 billion Golden Dome missile defense system is also funded.

Other Notable Provisions

• Education: A new tax credit for donations to scholarship-granting organizations and expanded 529 plans for K-12, trade schools, or home purchases.
• Air Traffic Control: $12.5 billion to modernize outdated systems, addressing staffing shortages and antiquated equipment.
• Debt Ceiling: The bill raises the debt limit by $5 trillion to avoid a default, though this has drawn criticism from some Republicans.

The Big Picture

The OBBBA is a bold, divisive package. Supporters, including the White House, call it the largest tax cut in history, projecting $10,000-$13,300 in annual savings for typical families. Critics, like the Congressional Budget Office, estimate it adds $3.3 trillion to the deficit over a decade, with wealthier households gaining more ($12,000 annually) while the poorest lose $1,600 due to program cuts. The bill passed the House in May 2025 (215-214) and the Senate in July (51-50, with VP JD Vance breaking the tie). It now awaits final House approval.

This legislation is a high-stakes gamble, balancing tax relief and security with cuts to safety nets. Its fate in the House and its long-term impact on Americans—rich, poor, and in between—will shape the nation’s economic and social landscape for years.

FAQs

1. Will the Big Beautiful Bill really save me money on taxes?
   For many, yes—especially if you rely on tips, overtime, or live in a high-tax state. The no-tax-on-tips provision and higher SALT cap could put more money in your pocket. But if you’re low-income and depend on Medicaid or SNAP, cuts to those programs might offset tax savings.
2. How will Medicaid changes affect me?
   If you’re on Medicaid, you might face work requirements, more frequent eligibility checks, or new co-pays. This could make it harder to stay covered, especially if paperwork is a hassle. The $50 billion rural hospital fund aims to help, but critics say it’s not enough.
3. What’s a Trump Account, and how does it work?
   It’s a savings account for kids born between 2024 and 2028, starting with a $1,000 government deposit. Parents can add $5,000 yearly, and the money grows tax-free for things like college, job training, or a home down payment. Think of it like a 529 plan with more flexibility.
4. Why is the debt ceiling increase controversial?
   Raising the debt limit by $5 trillion allows the government to keep borrowing, but some Republicans, like Elon Musk, call it reckless spending. Supporters argue it’s necessary to avoid a default that could tank the economy.
5. When will the bill become law?
   The Senate passed it on July 1, 2025, but the House must approve the Senate’s version or reconcile differences. Trump wants it signed by July 4, but negotiations could stretch longer.

Sources: Congressional Budget Office, Center on Budget and Policy Priorities, Tax Foundation, White House, CBS News, Wikipedia