The most ambitious tax and investment package since 2017 is now law. On July 4, President Donald Trump signed the “Big Beautiful Bill” after the House approved the final version 218-214 and the Senate passed it 51-50 with Vice President J.D. Vance casting the deciding vote. The legislation delivers permanent tax cuts for individuals and small businesses, expands deductions, repeals Biden-era reporting rules, and renews capital investment incentives.
The bill is a sweeping and strategic consolidation of core conservative economic goals. It locks in Trump-era tax cuts, broadens deductions for families and workers, delivers long-sought relief to small businesses, and reestablishes capital expensing incentives to spur growth. Paired with major regulatory rollbacks and funding shifts, the package gives Trump a clear legislative win. Here’s a breakdown of the major provisions included in the Big Beautiful Bill:
Income Tax Cuts Made Permanent: The bill makes permanent the personal income tax rates and bracket changes enacted in 2017. It also adds an additional year of inflation adjustment to the 10%, 12%, and 22% brackets, further lowering the tax burden on working families.
Standard Deduction Increased and Locked In: The standard deduction, claimed by roughly 90% of taxpayers, is increased by $1,500 for married couples filing jointly ($31,500 total), $1,125 for heads of household ($23,625), and $750 for individuals ($15,750). These amounts will be indexed for inflation beginning in 2026. (RELATED: Supreme Court Delivers Major Blow to Porn Industry in Landmark Ruling)
Expanded and Permanent Child Tax Credit: The child tax credit is permanently set at $2,200 per child starting in 2025, up from $2,000. The expanded phase-out thresholds of $200,000 for individuals and $400,000 for joint filers are preserved. The $500 credit for other dependents is also made permanent.
Permanent Small Business Relief (199A): The 20% deduction for Qualified Business Income (QBI) is permanently extended. The income thresholds for phasing out the deduction are increased to $75,000 (individual) and $150,000 (joint). A new $400 minimum deduction is available for business owners earning at least $1,000 in QBI from active participation.
100% Expensing Restored and Expanded: Businesses can now permanently expense 100% of qualified property costs acquired after January 19, 2025. This provision had been set to phase down under prior law. Expensing is also extended to new factories and improvements to production-related facilities through 2028.
Section 179 Expensing Boosted: The maximum amount businesses can expense under Section 179 increases to $2.5 million, with phase-outs beginning at $4 million. These thresholds are indexed for inflation starting in 2026.
Pro-Growth Interest Deductibility Restored: Businesses may once again deduct interest payments based on EBITDA (earnings before interest, taxes, depreciation, and amortization), reversing a 2022 change that had narrowed deductions to EBIT. According to the Tax Foundation, this change is projected to grow GDP by 0.1%.
Death Tax Exemption Increased: The federal estate and gift tax exemption rises to $15 million for individuals ($30 million for married couples) in 2026, indexed for inflation thereafter.
No Tax on Tips and Overtime Pay: The bill creates a new deduction of up to $25,000 for tip income and up to $12,500 for overtime pay. Both deductions begin phasing out at $150,000 (single) or $300,000 (joint) in adjusted gross income. These deductions apply through 2028.
Opportunity Zones Made Permanent: The Opportunity Zone program is now permanent, encouraging over $100 billion in long-term investment in low-income and rural communities. This expands on provisions initially enacted in 2017.
New Deductions for Seniors and Car Loans: Seniors age 65+ can claim a $6,000 deduction (phasing out above $75,000 AGI single/$150,000 joint) from 2025 to 2028. Interest on U.S.-assembled new car loans is deductible up to $10,000 per year through 2028.
HSA Expansion and 1099-K Repeal: Bronze and catastrophic health plans are now eligible for Health Savings Accounts (HSAs). The bill also repeals Biden’s $600 threshold for 1099-K forms from Venmo, PayPal, and similar platforms, restoring the $20,000/200 transaction standard.
Charitable Deduction for Non-Itemizers: A permanent above-the-line deduction of up to $1,000 is created for non-itemizers who donate to charity.
Paid Family and Medical Leave Credit Extended: The credit is permanently extended nationwide. The employee eligibility period is shortened from one year to six months. Employers may claim the credit based on the percentage of premiums paid.
Firearm Suppressor Tax Eliminated: The $200 excise tax on firearm suppressors is eliminated, aligning the tax code with long-standing Second Amendment goals.
The Big Beautiful Bill delivers on Trump’s campaign promise to build on his 2017 tax reforms and secure long-term tax relief. With the legislation now law, attention turns to how Trump leverages this win to pursue trade, immigration, and foreign policy objectives in the months ahead. (RELATED: State Supreme Court Strikes Down Evers’ Use of Line-Item Veto on a Literacy Coaching Program Bill)
The battle over the ‘big, beautiful bill’ moves from Capitol Hill to the campaign trail. Democrats and Republicans clash over Trump’s newly signed domestic policy package, with supporters calling it a transformative economic blueprint and critics warning of fiscal risks and income inequality.
As both parties prepare for the 2026 midterms, the law will serve as a central talking point on the stump—galvanizing Trump’s base while sharpening Democratic attacks on the long-term costs and social impacts of the bill. In many ways, the fight over the Big Beautiful Bill is just beginning.