On July 4, 2025, President Donald Trump signed the "One Big Beautiful Bill" (OBBBA) into law, significantly altering U.S. fiscal policy. The legislation, passed by the House of Representatives, introduces substantial tax cuts and spending reforms.
Key tax changes include an increase in the child tax credit from $2,000 to $2,200 per eligible child, effective immediately. Provisions from the 2017 Tax Cuts and Jobs Act, set to expire in 2025, are now permanent, maintaining current tax rates and brackets. Businesses can immediately write off 100% of equipment and research costs.
The bill also increases the State and Local Tax (SALT) deduction cap to $40,000 for households earning under $500,000 through Fiscal Year 2029. However, it includes significant cuts to social programs, such as a $1.2 trillion reduction in Medicaid and food assistance over the next decade.