House Republicans Advance Sweeping Tax and Spending Bill Impacting Household Finances

House Republicans have advanced a sweeping multitrillion-dollar tax and spending package that could significantly reshape federal tax policy, social safety net programs, and student loan rules if enacted.

The bill, titled the “One Big Beautiful Bill Act,” aims to make permanent the 2017 Trump tax cuts while introducing or expanding several new tax provisions. Key changes include a higher cap on the state and local tax (SALT) deduction, a larger child tax credit, and expanded eligibility and contribution limits for health savings accounts (HSAs).

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To offset tax cuts, the bill proposes approximately $1 trillion in reductions to Medicaid and Supplemental Nutrition Assistance Program (SNAP) funding—the largest in either program’s history. According to watchdog group Accountable.US, the changes could result in 14 million people losing health coverage and 3 million households losing food assistance.

The bill introduces a new $4,000 tax deduction for low- and middle-income seniors and creates “Trump Accounts,” savings vehicles for children that begin with a $1,000 federal deposit. It also establishes a tax deduction for up to $10,000 in car loan interest on U.S.-assembled vehicles, and provides a temporary exemption from income tax on tips for workers earning less than $160,000.

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The legislation would also eliminate subsidized federal student loans and several deferment options, and extend repayment terms to up to 30 years. “A 30-year repayment term means indentured servitude,” said higher education expert Mark Kantrowitz.

In addition, the bill would end tax credits for electric vehicles and residential clean energy upgrades after 2025, reversing extensions made under the Inflation Reduction Act. The bill passed the House on May 22 and faces expected revisions in the Senate before any final enactment.