5 Basic Expenditure from the Passing of the Big Beautiful Bill Act

With the thinnest margins (215 to 214), the House of Representatives voted to pass the Trump’s domestic policy bill. According to TowerThe Big Beautiful Bill law has trillions of dollars of impact on US taxpayers, including renewing tax cuts by the 2017 tax cuts and jobs, deduction for income from advice and increased discounts on state and local income tax. However, the bill proposes to pay for these tax cuts by limiting the benefits of social services such as Medicaid, food stamps and student loan payment plans. In this article, I am discussing five basic expenses from its passage and what it may mean to the US and the taxpayers.

1. The Trump First Country Tax cuts are back in the focus

Since the transition of the 2017 tax cuts and jobs law, many have now wandered as a turning point in the future of taxation in the US. The reason for this is due to the Byrd ruleWhich, according to the Economic Policy Innovation Center, states that a reconciliation bill (not in contrast to the tax cuts and jobs law) cannot increase the deficit in years outside the 10 -year budget window. As the law on tax cuts and jobs, in fact, increased the deficit, the provisions by this bill could not be permanent.

This rule placed significant emphasis on the events this year, where Congress was forced to allow either the provisions of the sunset or to pass new legislation to extend these provisions, or, in the case of the large beautiful bill, to make these provisions permanent. According to TowerThe most important tax provisions for individuals who will be expanded or permanently include lower income tax rates, higher levels, reductions with lower mortgage loans, elimination of various ownerships that highlight and moved reductions. For companies’ taxpayers, the specialized deduction of business income will be renewed and increased, foreign income provisions, such as Gilti, FDII and Beat, will be permanent, the bonus will be renewed by 2029 and the R&D could be made 100% by 20%.

According to the Congress Budget Office, the large beautiful account has a preliminary expected increase in the deficit of more than $ 3 trillion. This increase coincides with the bill that also increases the debt ceiling by $ 4 trillion, which, as I wrote earlier for TowerIt can be an important part that contributes to the deterioration of the evaluation of US credit markets and abolish bond markets.

2. Trump Campaign promises were fulfilled

In addition to the campaign to expand or create many of the previous tax cuts, this bill is good for many of the other promises of Trump’s campaign. According to The guardianTrump has competed for several tax cuts for working class taxpayers and low and medium income. These included overtime, tips and interest paid for car loans. He also struggled for enhanced child tax credit and savings account. All of these promises of renewed costs and tax cuts appear in the issuance of the bill passed by home.

3. Renewed reductions for state and local taxes

A controversial object at the end of the passage of the house was the discount for the state and local taxes paid. Taxpayers referring to their taxes (instead of receiving the standardized discount) are allowed to deduct taxes paid to state and local jurisdictions. This discount may include many things, but the most common source is the taxes paid for property. According to the 2017 tax cuts and jobs law, this deduction was significantly reduced to a maximum of $ 10,000.

The threshold has created significant tension between policy makers, as $ 10,000 applies equally to all taxpayers. While taxpayers at lower costs of living and low taxes may have considered $ 10,000 as reasonable, taxpayers at higher life costs and high tax situations were more likely to exceed this ceiling, losing significant tax deductions. According to CnbcIn the big beautiful bill, this ceiling increased to $ 40,000 with the gradual abolition for high income taxpayers (over $ 500,000). The ceiling will increase by 1% annually from 2026 to 2033. As most lower income taxpayers do not indicate their taxes and increased deduction does not benefit higher income households, this enhanced deduction seems to lead to significant tax deer.

Despite the possible benefits of an enhanced state and local tax deduction, this is a provision to watch as the bill moves to the Senate. According to Political; Many in the other chamber are tired of this particular arrangement and could be treated with friction.

4. A cut in social services such as Medicaid, Snap and Student Loans

To pay for such sweeping tax cuts, the house had to cut costs and many of these cuts were about social services. Msnbc It says the bill reduces federal funding for SNAP by $ 267 billion and Medicaid by $ 700 billion. Between 8 and 15 million people will lose health care between these cuts. This would result in domestic resources between the poorest taxpayers who decrease by more than 4% over the next eight years. The big beautiful account will significantly increase the work requirements for Medicaid recipients.

However, the reduction of social services is aimed not only at those who receive government assistance to health insurance and food. As mentioned by Tower; Taxpayers receiving college federal loans for college will also face very new programs and borrowing conditions. For example, loans will be calculated on the basis of the average cost of all similar college programs (and not the school), loans will have a maximum of $ 50,000 for undergraduate (150,000 for professional programs), restrictions on who can receive loans, reduce most of student payments and new student loan plans. These provisions will significantly affect the current students and students who continue to pay their loans.

5. The push to sign the account in the law at 4^th July

Since Trump won the election, it looked at the passage of this home political agenda during the first year of this term. The passage of the large beautiful home account is an important step towards achieving this goal. The Republican Party had a very subtle majority in this chamber, as Republicans could only lose three votes to pass the legislation. The bill is now headed to the Senate, where many other difficulties could arise. However, as proposed as a budget reconciliation, the bill only needs a simple majority (and not 60 votes) to pass.

According to CNNTrump’s day of independence is the day that will sign the big beautiful bill, making these changes effective for this year. The bill that passed the house in this subtle vote is a crucial step towards achieving this goal.