The U.S. House narrowly passed President Donald Trump’s One Big Beautiful Bill Act early Thursday after an all-night session.
The 1,116-page package extends tax cuts from his first term, introduces new tax breaks, and restructures programs like Medicaid, SNAP, and student loans. The vote, 215-214, saw unified Democratic opposition, two Republicans voting against, and one voting present. The bill now heads to the Senate, where revisions are expected.
“To put it simply, this bill gets Americans back to winning again,” House Speaker Mike Johnson (R-LA) said after the vote, per Fox 4 KDFW.
The legislation, estimated by the Congressional Budget Office (CBO) to add $3.8 trillion to the federal deficit from 2026 to 2034, extends $4.5 trillion in 2017 tax cuts and introduces new exemptions, including no taxes on tips and overtime pay through 2028, no taxes on Social Security, and a temporary $10,000 deduction for car loan interest on American-made vehicles.
The standard deduction rises to $32,000 for joint filers, and the child tax credit increases by $500 to $2,500 through 2028, dropping to $2,000 thereafter. However, a new requirement that both parents have a Social Security number could make 4.5 million children ineligible for the credit, according to USA TODAY.
The nonpartisan Tax Policy Center estimates the bill “would cut taxes on average by about $2,800 in 2026,” with more than two-thirds of the cuts benefiting those earning $217,000 or more annually. Households with incomes of $1.1 million or more would receive nearly a quarter of the cuts, while those earning $17,000 to $51,000 could lose about $700, and those under $17,000 could lose over $1,000, primarily due to cuts in assistance programs.
Rep. Thomas Massie (R-KY), a deficit hawk, voted against the bill, warning, “This bill is a debt bomb ticking,” Fox 4 reported.
Rep. Andy Harris (R-MD), Freedom Caucus chairman, voted present, citing insufficient review time. To appease conservatives, a last-minute 42-page amendment quadrupled the state and local tax (SALT) deduction to $40,000 for incomes up to $500,000 and accelerated Medicaid work requirements.
Key Provisions
The bill introduces “Trump” savings accounts (formerly MAGA accounts), providing $1,000 for children born between January 1, 2024, and December 31, 2028. Families can contribute $5,000 annually, with funds accessible at 18 for education, training, or home purchases, and fully at 30.
A version of the no-tax-on-tips provision, one of Trump’s campaign talking points, has already unanimously passed in the Senate, The Dallas Express reported. However, unlike the stand-alone Senate bill version, the House version of the measure will expire in 2028.
The provision to exempt overtime pay from taxes could reduce federal revenue by $680 billion to $866 billion from 2025 to 2034, according to the Tax Foundation and Yale’s Budget Lab.
Medicaid faces $698 billion in cuts, with new rules starting January 1, 2029, requiring able-bodied adults without dependents to complete 80 hours monthly of work, education, or service. Eligibility verification doubles to twice yearly, and homes valued over $1 million disqualify applicants. The CBO estimates that 7.6 million Americans could lose health insurance over a decade.
From 2028 forward, SNAP faces $267 billion in cuts, with states covering 5% of benefits and 75% of administrative costs. Currently, states pay zero benefit costs but 50% of the program’s administrative costs, Fox 4 reported. Work requirements extend to ages 55-64, impacting 42 million beneficiaries, and exemptions are limited to parents of children under 7.
The bill allocates $150 billion for defense, including $25 billion for Trump’s “Golden Dome” missile defense shield, $21 billion for ammunition, $34 billion for naval expansion, and $5 billion for border security.
Immigration changes include a $1,000 asylum fee, $500 semi-annual work authorization fees, and costs for appealing court decisions, alongside a $12 billion fund to reimburse states aiding deportations and border security. The bill discourages states from using their own funds for Medicaid coverage for undocumented children.
Student loans face a $330 billion overhaul, consolidating repayment plans into a 10-to-25-year standard option and a less generous “repayment assistance” plan. The bill also repeals Biden-era loan forgiveness, caps loans for parents and undergraduates, and eliminates future graduate lending programs.
The bill promotes fossil fuel extraction by cutting royalty rates for oil, gas, and coal and authorizing public land sales in Nevada and Utah, drawing criticism from Democrats and environmentalists.
Winners and Losers
High-income households benefit most, per the Tax Policy Center and Penn Wharton, while lower-income households face losses from reduced Medicaid, SNAP, and student loan benefits. The Senate is expected to revise the bill to address fiscal and regional concerns.