So What’s In That Big Beautiful Bill?
Almost every elected Democrat when asked about passage of the “One Big Beautiful Bill” (BBB) has claimed that it “hurts the working class in order to benefit the wealthy”, or that “people will die” because of cuts to Medicaid. Rather than fearmongering, let’s take a look at some of what the bill actually does.
The BBB is a US federal statute passed by congress and signed into law by President Trump on July 4, 2025. The legislation permanently extends the individual tax rates signed into law in 2017, which were set to expire at the end of this year. So instead of a 22 percent tax increase for the average family, the BBB locks in the lower tax rates, maintaining the doubled standard deduction, expanded child tax credits, and reduced tax brackets for middle-class families. Corporate tax rates remain at 21%, which provides businesses with long-term certainty for planning and investment decisions.
The BBB raises the cap on the state and local tax deduction (SALT) to $40,000 for taxpayers making less than $500,000. This cap will revert back to $10,000 after five years unless future legislation makes it permanent.
In a nod to the service and blue-collar workers who form a significant portion of the American workforce, the BBB creates new tax deductions for tips and overtime pay for workers making less than $150,000. Restaurant servers, bartenders, hotel workers, other service industry employees and workers in manufacturing, construction, and other hourly positions will all benefit, with an estimated savings of about $1,700 annually. The legislation includes income caps and qualifying occupation lists to ensure benefits are properly extended to the intended recipients. This provision will expire in 2028 unless it is made permanent.
The BBB expands deductions for seniors to help with medical and living costs, including enhanced deductions for prescription medications, long-term care expenses, and home modifications for aging in place. The legislation increases the annual tax deduction for seniors over 65 from $2,000 to $6,000 ($12,000 for a married couple). The deduction phases out for individuals making over $75,000 and married couples making over $150,000. According to the Council of Economic Advisors, 88% of seniors will be able to claim enough deductions to cover any Social Security tax burden – up from 64% under the previous rules.
The maximum amount of the child tax credit is increased by the BBB from $2,000 per child to $2,200 per child, with a projected savings of $1,300 for a family of four. The bill includes the creation of savings accounts under which the US government deposits $1,000 upon the birth of a child born between 2025 and 2028, to which their parents may contribute up to $5,000 per year, with the money growing tax-deferred and intended for higher education, job training, or a down payment on a home.
Beginning in 2026, the BBB includes a new deduction that allows non-itemizers to deduct up to $1,000 in charitable gifts for single filers or $2,000 for married couples filing jointly.
Car buyers who earn less than $100,000 ($200,000 per couple) and who purchase an automobile assembled in the US between 2025 and 2028 for personal use will be able to deduct up to $10,000 per year in auto loan interest.
In regard to the claim by Democrats that Republicans are heartlessly throwing millions of helpless Americans off Medicaid and that our rural hospitals are in danger of closing, it should be noted that the BBB establishes a $50 billion Rural Hospital Fund – up from $25 billion – specifically designed to support health providers in rural areas and provide a safety net against any loss of Medicaid funds. It also requires minimum staffing ratios for nursing homes to ensure proper care.
Historically, Medicaid was established to help the aged, blind and disabled, but its rolls have swelled with able-bodied adults, doubling its costs in less than 10 years, and consuming $6,900 from an average family’s income taxes. The BBB protects the aged, blind and disabled, and adults with dependent children under 14 or with serious medical conditions from any reductions in Medicaid. And it allows able-bodied adults ages 19 to 64 to remain on Medicaid and food stamps on the condition that they spend 20 hours per week working, looking for work, or training for work. That’s it – and a work/education requirement is a very popular concept with the majority of the American people. When a similar requirement was enacted during the Clinton administration, welfare rolls dropped by half. Able-bodied adults went back to work and earned their way off welfare and on to better lives. The BBB also includes enhanced fraud detection systems to ensure that Medicaid and SNAP benefits are reaching those who legitimately qualify, and it requires states to review eligibility for Medicaid expansion adults every six months, rather than annually.
To my Democrat friends: Millionaires and billionaires don’t work for tips. They don’t log in their hours for overtime pay. They don’t rely on social security. This legislation is a clear gain for the lower and middle class.
In addition, this bill supports our veterans and service members by allocating an additional $150 billion to defense and veterans’ affairs, emphasizing military readiness and veteran support through modernized equipment, enhanced training programs, and expanded healthcare services. This includes comprehensive mental health programs for veterans, improved housing for military families, and expanded educational benefits under the GI Bill. And for everyone’s safety, the bill includes $12 billion in air traffic control funding.