About a year ago, on July 4, 2025, the president signed the One Big Beautiful Bill into law. It’s the biggest rewrite of your taxes and benefits in nearly a decade.
I’ve read a lot of tax bills in my years as a CPA. This one’s a monster — nearly 900 pages and a $3.4 trillion price tag, according to the Congressional Budget Office (CBO).
A year in, we can finally see who it helped and who it hit. Some of this already showed up on your 2025 return. Some is landing right now. And some is still on the way.
Here’s the honest breakdown. Where you land depends mostly on one thing: whether you’re a taxpayer or you lean on federal aid.
First, the big picture. CBO projects that, on average, households come out ahead — but not evenly. It estimates the lowest-income households lose about $1,200 a year in resources through 2034, while the top 10% of earners see income rise about 2.7%, mostly from the tax cuts.
The White House calls it a working-family tax cut. Critics say it’s paid for by cutting aid to the poorest. As one Bipartisan Policy Center analyst put it, both can be true. So let’s look at both sides.
Who it’s helping
1. The tax hike that didn’t happen. The 2017 tax cuts were set to expire last year. The law made them permanent, so your rates didn’t jump. It also locked in the bigger standard deduction — now $16,100 for singles and $32,200 for couples, and rising with inflation each year.
2. No tax on tips. If you work for tips, you can deduct up to $25,000 of them through 2028. The break shrinks once your income tops $150,000 ($300,000 for couples). Waiters, bartenders, and stylists, this one’s for you.
3. No tax on overtime. Clock overtime? You can now deduct the extra half-time pay — up to $12,500, or $25,000 for couples — through 2028. The same income phaseouts as the tip break apply.
4. A bigger break for seniors. If you’re 65 or older, you can claim an extra $6,000 deduction through 2028, as long as your income stays under $75,000 ($150,000 for couples). For some retirees, that’s enough to erase what they’d owe on their Social Security.
5. A deduction for your car loan. Buy a new, U.S.-assembled vehicle for personal use between 2025 and 2028, and you can write off up to $10,000 a year in loan interest. It phases out above $100,000 in income ($200,000 for couples). Used cars and leases don’t count.
6. A fatter child tax credit. The credit rose from $2,000 to $2,200 per kid, and it’s now permanent and tied to inflation. Not life-changing, but it’s real money for families.
7. Room to deduct your state taxes. The cap on deducting state and local taxes jumped from $10,000 to $40,000 through 2029. If you own a home in a high-tax state, this one’s big. It drops back to $10,000 in 2030.
8. A $1,000 head start for babies. The law created “Trump accounts” — new investment accounts for kids — and seeds eligible newborns with $1,000 from the government. Eighteen years of growth isn’t nothing, though as some experts note, the accounts come with strings attached.
One thing worth saying plainly: The biggest dollar breaks flow upward. The law also raised the estate-tax exemption to $15 million per person, which only matters if you’re leaving a fortune behind. That’s a big reason the CBO sees the wealthy gaining most.
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Who it’s hurting
1. Medicaid gets harder to keep. The law added an 80-hour-a-month work requirement, doubled eligibility checks to twice a year, and lets states charge up to $35 per visit. The CBO expects millions to lose coverage — older adults especially, as we saw with these vulnerable seniors losing job training.
2. SNAP tightens up. Food stamp work requirements now reach adults up to 64, states must cover a share of benefit costs for the first time, and nutrition-education funding got cut. Expect some households to lose help buying groceries.
3. The health insurance cliff returns. The enhanced ACA subsidies expired at the end of 2025. When open enrollment opens November 1, roughly 24 million marketplace buyers — freelancers, early retirees, gig workers — face higher premiums. Buy your own coverage? Here’s how to handle the gap before Medicare.
4. Student loans get pricier. The law scrapped the SAVE plan and other income-driven options in a broader student-loan shake-up, replacing them with a new Repayment Assistance Plan and a standard one. New borrowers also lose the ability to pause payments for hardship. These changes are landing now.
5. The clean-energy discounts are gone. The $7,500 tax credit for a new electric vehicle ended September 30, 2025. Credits for home solar, heat pumps, and efficiency upgrades expired December 31. If you were counting on them, that window’s closed.
The bottom line
So who won? Here’s the honest answer. If you earn a paycheck and pay taxes, you probably came out ahead — depending on your income. If you lean on Medicaid, food stamps, ACA coverage, or student loans, you’re likely worse off — and more pain is coming.
Most of us are a mix. You might pocket a bigger child credit and a car-loan deduction while watching your health premium climb.
My advice? Run your own numbers before year-end. Check which new deductions apply to you. And if you buy your own health insurance, price out 2026 now — before the open-enrollment sticker shock hits.
The law’s a year old. But for most of us, the real results are just starting to arrive.
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