The One Big Beautiful Bill Act (OBBBA) is a proposed budget reconciliation bill in the 119th United States Congress. It was recently passed by the House of Representatives on May 22nd, 2025 and passed by the Senate on July 1st, 2025.
The bill includes, but it is not limited to, the following:
- Permanent extensions of the provisions set in the 2017 Tax Cuts and Jobs Act (TCJA) for individuals and businesses.
- Increases the State and Local Tax (SALT) deduction from $10,000 to $40,000 (for taxpayers making less than $500k).
- Taxpayers may be allowed to deduct up to $10,000 per year of their interest on qualifying auto loans (for cars assembled in the U.S. and purchased between 2025 and 2028).
- $170 billion for spending on border security, creating the capacity to deport up to one million people each year.
What It Means for Taxpayers & the General Public
Taxpayer Impacts
- For families and workers: You could see larger annual tax breaks via expanded Child Tax Credit, tax-free tips and overtime deductions, and higher SALT cap limits.
- For seniors: A higher standard deduction (e.g. +$4,000 additional for filers 65+) brings extra relief.
- For energy users: Beware—EV and clean energy credits currently on your radar may disappear by end of 2025
- For individuals: Tax deductions for tip income (up to $25k/year) and overtime pay. Adds approximately $3.5 trillion to the federal deficit—future tax hikes may be likely. Additional government spending and tax cuts may fuel inflation.
- For businesses: 199A Deduction (Pass-Throughs) Extended. Regulatory Relief on Depreciation (continued 100% expensing for qualifying assets). Unlike past acts, there are no expanded credits for hiring or innovation.
Public and Social Impacts
- Medicaid & SNAP cuts: Could result in coverage loss for 11–12 million Americans by 2034—experts warn of hospital closures, spikes in uncompensated care, and limited access for vulnerable groups.
- Immigration enforcement increases: Expect billions allocated to ICE, deportations, border walls, and thousands of new agents.
- Clean energy rollback: Tax incentives removed, shifting favor towards fossil fuels; critics suggest it’s a setback for green jobs and energy transition .
The One Big Beautiful Bill is now on a tight deadline: successful House passage could send it to Trump’s desk by early July. Its fate hinges on intra-GOP debate, public pushback, and potential last-minute changes. If approved, the Act would usher in sweeping changes—from tax savings for many to sharp cuts in health and energy programs—and reshape federal budget dynamics for years to come.
If you would like to read a more detailed summary on the One Big Beautiful Bill Act, we encourage you to visit the Congress’ official website to track the bill and to learn more about the provisions within it.