WASHINGTON - President Trump on Friday signed what he calls the One, Big, Beautiful Bill Act into law. The tax and spending cut bill passed the House on Thursday.

With it, wealthy Americans are poised to receive significant tax breaks partly offset by steep cuts to social welfare programs.

The bill makes 2017 tax breaks from Trump’s first term permanent, while adding some new tax breaks, such as no taxes on tips up to $25,000 and a “senior deduction” that will allow more people over 65 to avoid Social Security taxes.

Some policy analyses show the tax cuts for lower earners may be offset by the new costs they incur from lost support for health care and food assistance.

Most households — about 85 percent — would get a tax cut in 2026, according to an analysis from the Tax Policy Center. But while many of the bill’s changes are permanent, other provisions, such as the new deduction for seniors, are set to expire within a couple of years. The center estimates that by 2030, only about 70 percent of households would continue to have a tax break.

The center also estimates that nearly 60 percent of the tax benefits would go to those in the top quintile of annual incomes, or about $217,000 or more. Those households would receive an average tax cut of $12,500.

While other estimates of the bill’s tax changes by income bracket vary, they largely agree the tax breaks generally increase moving up the income ladder. (Source: The Hill)

Story Date: July 6, 2025