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Yahoo
an hour ago
- Yahoo
Trump signs ‘One Big Beautiful Bill' into law: What that means for your money
President Donald Trump signed the so-called One Big Beautiful Bill (OBBB) into law Friday, a budget that will have far-reaching repercussions on millions of Americans' bank accounts, for better and worse. The legislation is extensive, including hundreds of provisions that touch everything from individual rates to student loans to the estate tax. It attempts to pay for the included tax breaks by slashing spending on social safety net programs like Medicaid and nutritional benefits, as well as green energy programs. Even with these cuts, it is expected to add $3.1 to $3.5 trillion to the national debt over the next 10 years. Along with provisions directly affecting Americans' personal finances, it earmarks hundreds of billions of dollars for the president's deportation efforts. It also creates a dual-class tax structure: one for citizens and their families, and another for those with at least one immigrant member, regardless of whether they are documented or not. Various analyses of the bill's provisions find it will benefit wealthy Americans far more than lower-income earners. In fact, after-tax-transfer income for the lowest-earning 20% of Americans drops by an estimated $245 next year, increasing to a loss of $1,385 annually by 2033, according to the Penn Wharton Budget Model (PWBM). Future generations are also 'uniformly worse off,' according to PWBM. 'All future generations experience one-time welfare losses, ranging from -$22,000 for the lowest income quintile to -$5,700 for the highest,' the analysis reads. 'A middle-income child born today would see a $9,800 loss.' The Yale Budget Lab finds similar outcomes: It estimates changes to taxes and Medicaid and SNAP would lead to a $700 decrease in income for the lowest 20% of earners, while the top 1% would see a $30,000 increase. Republicans say it will have positive effects throughout the economy. 'There's a view that there's a lot of potential economic growth from the bill that will have a positive impact on the economy,' says Marc Gerson, member at Miller & Chevalier and former majority tax counsel for the U.S. Ways and Means Committee. The legislation, which totals almost 1,000 pages, is far-reaching, and the details of how many provisions will be implemented still need to be worked out. For example, while it calls for no federal taxes on some tips and overtime, the IRS still needs to write those regulations for businesses and individual taxpayers to follow. All that said, exactly how it will affect people is unknown at this time. Additionally, many of the individual tax cut provisions are temporary, lasting generally through 2028 (this differs by provision, though, and will be noted if the information is available). Here's what financial advisors and experts say Americans need to know about the OBBB now. The bill makes permanent certain provisions from the 2017 Tax Cuts and Jobs Act (TCJA), including lower individual tax rates compared to what was in place before then: 10%, 12%, 22%, 24%, 32%, 35%, 37%. That said, these rates have been in place since the 2018 tax year, so many taxpayers are already accustomed to them. It also eliminates personal and dependent exemptions, and some itemized deductions while keeping the doubled standard deduction (compared to pre-TCJA). Under the bill, the standard deduction for 2025 is $15,750 for single taxpayers, $31,500 for joint filers, and $23,625 for heads of household. 'If you don't qualify for new tax benefits, your tax outcome may look similar to last year's since many provisions under the TCJA are being made permanent,' notes TurboTax. For the super wealthy, the bill makes permanent the doubling of the estate tax exemption from the TCJA. For decedents dying in 2026 and beyond, up to $15 million (and $30 million for couples) is exempt from the federal estate tax, and this exemption will be indexed for inflation. That mostly benefits individuals with estates in excess of $7.5 million, says Jane Ditelberg, director of tax planning at Northern Trust Wealth Management, the old exemption amount. 'Locking in the $15 million exemption indefinitely brings certainty to families planning major wealth transfers,' says Ditelberg. 'For more than two decades, taxpayers have faced a moving target, with the applicable rules changing depending on the year of death. This takes that risk off the table.' Under the bill, the child tax credit is increased from $2,000 per child to $2,200, and is subject to annual inflation increases. The bill requires the taxpayer claiming the credit, the taxpayer's spouse, and the child to have Social Security numbers. In place of eliminating taxes on Social Security, Americans 65 or older will see a temporary 'bonus' deduction of up to $6,000 on their income taxes. This will be available to single filers making a modified adjusted gross income up to $75,000, or couples making up to $150,000, for tax years 2025 to 2028. Car buyers will be able to deduct up to $10,000 of interest per year on new auto loans. This is limited by income: it phases out for single filers with incomes above $100,000 (and $200,000 for married couples). It also only applies to cars assembled in the United States. This is available for those who itemize and those who do not. The bill provides above-the-line deductions for some tip income and overtime pay for certain workers, fulfilling one of Trump's campaign promises. That said, there are important restrictions to keep in mind about both. Those with tip income can deduct up to $25,000 for qualified tips from their federal tax bill, phasing out for those with income above $150,000. This is in place for tax years 2025 to 2028. 'It's essential to understand that this deduction doesn't directly reduce your taxes dollar-for-dollar, and your actual tax savings will depend on your tax rate,' notes TurboTax. Those earning overtime pay can deduct up to $12,500 ($25,000 for married couples filing jointly), depending on income. Like the tipped income provision, this is available for tax years 2025 through 2028 and phases out for income above $150,000. Because many tipped workers are low-income, almost 40% already don't pay federal taxes on their tips, says Meg Wheeler, certified public accountant and founder of The Equitable Money Project. Additionally, tipped workers should know they will still technically owe state and employment taxes like Social Security and Medicare on their tips—it's still reportable income. This is not a total exclusion from paying taxes. 'We know that lots of tipped workers don't necessarily report all of their tips. So just even right there, that will be an interesting shift,' says Wheeler. 'I also am curious about whether or not this pushes more employers or even more employees to want to move to a tipped model, because they think this is helpful.' Gerson says these provisions—which the IRS will need to write guidance on before they are implemented—may create additional discrepancies on how workers are taxed in the same workplace. That can lead to headaches for business owners, as well as create tension among employees who are compensated differently. 'If you take a restaurant, you have some people who are tipped and will benefit from the exclusion, and then you have people that aren't tipped and won't benefit from it,' he says. 'It just has an impact on workforce dynamics. Some people [may] no longer want to be salaried because they can get in overtime.' The bill makes a number of changes to the federal student loan program starting in 2026, many of which will make payments higher for borrowers. The bill reduces the number of income-based repayment plans, phasing out the Income-Contingent Repayment (ICR), Pay As You Earn (PAYE) and Saving on a Valuable Education (SAVE) plans starting in July 2026. Current borrowers will have two years to switch to a version of the Income-Based Repayment (IBR) plan, the standard repayment plan, or the Repayment Assistance Plan (RAP), a new offering. New borrowers, meanwhile, will only be able to enroll in the RAP. 'Many existing borrowers will see higher monthly payments under these new plans, though the current iteration of the bill at least allows more time to change plans,' says Kate Wood, loans expert and writer at NerdWallet. 'As of now, student loan forgiveness still appears to be on the table, though RAP requires up to 30 years of repayment first, a longer repayment timeline than any current plan.' One of the big differences, says Wheeler, is that RAP has a minimum monthly payment. This is different from some of the current income-based repayment plans, which allow some borrowers to pay very low amounts or nothing at all, depending on their earnings. 'Now, all of a sudden they have to jump up to this minimum just because that's the rule, that's the law,' says Wheeler. 'I think that's going to be, right off the bat, a huge issue.' It also lowers the limits on graduate school loans, eliminates the federal Grad PLUS program altogether, and caps Parent PLUS borrowing. These changes apply to new loans starting July 1, 2026. While the high cost of graduate school has been a target of people who want to reform the student loan system in the U.S., experts say limiting how many federal loans borrowers can take out won't solve much. Instead, it means they will have to rely on private loans—which have fewer protections for borrowers and potentially higher interest rates—or skip higher education altogether. Those attending professional school for law or medicine may have the most to lose. One of the more contentious aspects of passing the bill was what to do with the cap on state and local tax deductions, or the SALT cap. Trump's 2017 tax bill put a cap of $10,000 on it; that cap has been increased to $40,000. This is one of the most expensive provisions in the bill. Taxpayers in California, Illinois, New Jersey, and New York stand to benefit the most: They account for 40 of the 50 top congressional districts affected by the cap. The cap reverts to $10,000 in 2030. 'It's increased relief, but it is temporary,' says Gerson. 'And so it's something that Congress will have to revisit.' The bill establishes so-called Trump accounts, which are a new type of tax-favored account for newborns. Children born between 2025 and 2028 will receive $1,000. The bill makes dramatic cuts to Medicaid, which is the health care program for low-income, disabled, and some senior Americans. It will also affect those who have Affordable Care Act (ACA) health care coverage. People on Medicaid will face strict new work requirements for able-bodied adults, and eligibility checks will increase from every 12 months to every six months. Estimates put the number of those losing health coverage at around 16 million Americans. 'It's very likely that people will lose coverage even if they still qualify, just due to the administrative burden,' says Kate Ashford, investing specialist at NerdWallet. 'It's also likely that some hospitals in rural areas that rely on Medicaid funding will reduce services or close, meaning that people in those communities may have to travel far or go without care if they get sick or injured.' Americans with ACA health insurance coverage will have to re-verify eligibility for tax credits each year, adding an additional hurdle to renewing. It also does not extend the ACA subsidies that help many Americans afford their coverage. 'If those expire, ACA health insurance costs will go up substantially, placing real stress on people's budgets and potentially resulting in people dropping health insurance,' says Ashford. 'Many immigrants who are legally residing in the U.S. will also lose access to ACA subsidies, forcing many of them to end coverage and raising rates for people who remain on plans.' Allowing the subsidies to expire will also raise costs substantially on small business owners who rely on ACA coverage, says Ashford, as will the Medicaid cuts. She says small business owners and other entrepreneurs may find that health insurance coverage is now too expensive to enter the field. This story was originally featured on Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
New York Post
an hour ago
- New York Post
Trump says Iran has not agreed to inspections, give up enrichment
President Donald Trump said on Friday that Iran had not agreed to inspections of its nuclear program or to give up enriching uranium. He told reporters aboard Air Force One that he believed Tehran's nuclear program had been set back permanently although Iran could restart it at a different location. Trump said he would discuss Iran with Israeli Prime Minister Benjamin Netanyahu when he visits the White House on Monday. Advertisement 'I would say it's set back permanently,' Trump said as he traveled to New Jersey after an Independence Day celebration at the White House. 'I would think they'd have to start at a different location. And if they did start, it would be a problem.' 5 President Donald Trump speaks to reporters aboard Air Force One during a fight to New Jersey on July 4, 2025. REUTERS Trump said he would not allow Tehran to resume its nuclear program, adding that Iran did want to meet with him. Advertisement The UN nuclear watchdog said on Friday it had pulled its last remaining inspectors from Iran as a standoff deepens over their return to the country's nuclear facilities bombed by the United States and Israel. The US and Israel say Iran was enriching uranium to build nuclear weapons. Tehran insists its nuclear program is for peaceful purposes. Israel launched its first military strikes on Iran's nuclear sites in a 12-day war with the Islamic Republic three weeks ago. 5 A satellite image of the Fordow Facility in Iran after the US bombardment on June 27, 2025. AP Advertisement 5 The US sent B-2 Stealth Bombers to the Fordow site while nuclear-powered submarines fired ballistic missiles at Isfahan and Natanz sites, south of Tehran. Rob Jejenich / NY Post Design The International Atomic Energy Agency's inspectors have not been able to inspect Iran's facilities since then, even though IAEA chief Rafael Grossi has said that is his top priority. Iran's parliament has passed a law suspending cooperation with the IAEA until the safety of its nuclear facilities can be guaranteed. While the IAEA says Iran has not yet formally informed it of any suspension, it is unclear when the agency's inspectors will be able to return to Iran. Advertisement Iran has accused the agency of effectively paving the way for the bombings by issuing a damning report on May 31 that led to a resolution by the IAEA's 35-nation Board of Governors declaring Iran in breach of its non-proliferation obligations. 5 Iranian Supreme Leader Ayatollah Ali Khamenei speaks during a meeting in Tehran on June 15, 2025. 5 President Trump salutes B-2 Bombers during a flyover at the White House alongside first lady Melania Trump on July 4, 2025. via REUTERS The US and Israeli military strikes either destroyed or badly damaged Iran's three uranium enrichment sites. But it was less clear what has happened to much of Iran's nine tons of enriched uranium, especially the more than 880 pounds enriched to up to 60% purity, a short step from weapons grade.
Boston Globe
2 hours ago
- Boston Globe
There are gray areas in the matter of shoplifting and policy making
What has reportedly Advertisement We should not be so quick to conclude that easing criminal charges against kids who pocket a box of candy or adults who make off with a box of tampons has somehow led to the level of theft being carried out by organized gangs, or that Get The Gavel A weekly SCOTUS explainer newsletter by columnist Kimberly Atkins Stohr. Enter Email Sign Up Holly Wenninger Malden What do Wu or Democrats have to do with locked-up toothpaste? In the lede of her column, Carine Hajjar writes, 'Under Boston Mayor Michelle Wu, there was a 55 percent increase in shoplifting between the first half of 2019 and the same period in 2024.' Not only is Wu not the Suffolk district attorney (as the mayor herself notes, in a quote Hajjar properly includes later in the piece), but also, while it is true that Advertisement I don't appreciate CVS locking up toothpaste either, but my first instinct is not to blame the mayor or Democrats in general. Ari Ofsevit Cambridge I lean progressive, and I'm not in favor of going easy on low-level crimes Carine Hajjar paints all progressives as soft on crime and not wanting to prosecute low-level crimes, such as shoplifting. She uses some form of the word 'progressive' seven times. Yes, political figures who push for those policies are fair game for criticism. But it is a disservice to readers to assume that all progressives support those policies. I lean progressive on most issues, and I do not support them. John Bowe Belmont
