The changes are significant, but not immediate. Most will go into effect from July 1, 2026, to July 1, 2028, including:

• Big cuts to federal loans for grad students and parents.
• A new repayment plan landscape.
• Limits to relief options for struggling borrowers.

Since Congress wrote these changes into law, they’re not susceptible to legal challenges, says Stanley Tate, a lawyer who specializes in student debt issues. (Many Biden-era policies, like mass student loan forgiveness and the SAVE plan, were not explicitly authorized by Congress. This opened them up to lawsuits.)

“The one silver lining on all of this is that the road ahead, as far as your options, is clearer than it has been throughout this entire administration thus far,” Tate says. “Now that we have rules, it’s incumbent upon us to look at those rules and take the optimal approach for our situation moving forward.”

The bill will impact nearly all student loan borrowers. Take time to fully research the changes and decide on a course of action. Here are the eight top takeaways to know.

1. Severe cuts to graduate student borrowing

Federal PLUS loans for graduate and professional students will no longer be offered starting July 1, 2026.

Since 2006, these loans have been available to graduate and professional students, up to their total cost of attendance.

Starting next summer, graduate borrowers can only take out direct loans that have a lower borrowing cap. These are the new limits for graduate school borrowing:

• For graduate students: up to $20,500 per year; $100,000 total.
• For professional and medical students: up to $50,000 per year; $200,000 total.
• Lifetime maximum (undergraduate plus graduate studies): up to $257,500.

Without grad PLUS loans, these borrowers may turn to private student loans to cover costs each year beyond $20,500 or $50,000. Private loans offer fewer borrower protections and are not eligible for forgiveness programs.

“Private student loan access is by no means guaranteed, and even if a student can access private student loans, the interest rate may be quite a bit higher than the interest rate for federal student loans,” says Lesley Turner, an associate professor of public policy, focused on higher education finance, at the University of Chicago.

Timing, impact and next steps

These changes impact students who begin their graduate program on or after July 1, 2026.

If you’re in the middle of grad school right now, or if you’ll start your program by June 30, 2026, you can still take out grad PLUS loans for up to three years, or for the duration of your program — whichever period is shorter.

If you’re planning on grad school in the future, compare program costs, ask your institution about grants, and look to private student loans as a last resort.

“Graduate programs vary a lot in terms of prices and in terms of outcomes, and so it often can be worth it to shop around,” Turner says. “Oftentimes, even in a given geographic area for a given program type, like masters in social work, there’s going to be more expensive and less expensive programs.”

We don’t yet know how exactly programs will be classified as “professional” or “graduate.” More programs may try to label themselves as “professional” programs so students can access a higher loan limit, Turner says.

2. Repayment plans get complete overhaul

Millions of borrowers may be forced to change their student loan repayment plan. Most income-driven repayment (IDR) plans will no longer be available, effective July 1, 2026. That includes:

• The Saving on a Valuable Education (SAVE) plan.
• The Pay as You Earn (PAYE) plan.
• The Income-Contingent Repayment (ICR) plan.

Existing borrowers can keep access to a modified version of the Income-Based Repayment (IBR) plan (a specific kind of IDR plan). This law also removes the “financial hardship” requirement to enroll in IBR.

New borrowers will have access to just two repayment options: a modified version of the standard plan and the Repayment Assistance Plan (RAP).

• The modified standard plan splits monthly payments between 10, 15, 20 or 25 years, based on the amount of debt owed.
• The RAP plan caps monthly payments based on adjusted gross income and family size. It also offers forgiveness of remaining debt after 30 years of payments.

Timing, impact and next steps

Current borrowers who want to stay on an IDR plan must switch to Income-Based Repayment (IBR) no later than July 1, 2028. If they don’t act, they will be moved to the RAP plan.

The modified standard plan and the RAP plan will become available to new and existing borrowers on July 1, 2026.

A note for current students: If you take out a new loan after July 1, 2026, you’ll be cut out from IDR and only have access to RAP and the standard plan. That’s because all loans must be repaid under the same plan.

3. Parent borrowers face lower borrowing limits, blocked from income-driven repayment

Parents of undergraduates who take out a parent PLUS loan will no longer be able to borrow up to the cost of attendance. This may force some families into private student loans, which are not available to everyone.

Here are the new parent PLUS borrowing limits per student, effective July 1, 2026:

• Per year: up to $20,000.
• Overall: up to $65,000.

Repayment options will also become significantly more limited. Borrowers who take out new parent PLUS loans on or after July 1, 2026, can only repay their loans with the standard plan. They won’t have access to an IDR plan or the RAP.

This applies to all of your parent PLUS loans, even if you took some loans out before the July 1, 2026, cutoff. For example, say you took out one parent PLUS loan in 2023, and then decide to borrow another parent PLUS loan in 2027. Both of those loans would become ineligible for income-driven repayment and the RAP.

“That gets very precarious if you’re someone who already has a sizable balance and is still borrowing, say, for child number two, child number three, et cetera,” Tate says.

Timing, impact and next steps

Consolidate your existing parent PLUS loans, and enroll in the Income-Contingent Repayment plan before July 1, 2026. Once you are on the ICR plan, you can move to the Income-Based Repayment plan, which is the only income-driven plan that will remain for the long haul. If you miss this consolidation deadline, you will be permanently blocked from any income-driven repayment plan, including RAP.

There’s also a legacy provision for the loan limit change. If you took out a parent PLUS loan prior to July 1, 2026, you can continue borrowing up to your student’s cost of attendance for up to three years, or until your kid finishes school — whichever period is shorter.

Going forward, families who rely on parent PLUS loans need to think long-term about college financing to avoid unexpected funding gaps, explains Megan Walter, senior policy analyst at the National Association of Student Financial Aid Administrators.

You can borrow up to $20,000 per year, but only $65,000 total. So, if you borrow $20,000 for the first three years of your kid’s education, you’ll have $5,000 for their fourth year.

4. Pell Grants for short-term workforce training programs

Students who qualify for the Pell Grant — a need-based federal grant program that goes up to $7,395 per year — may use it for short-term workforce training programs. Those programs can range from HVAC and plumbing training courses to coding bootcamps, Walter says.

Programs will have to meet certain benchmarks. English language learning programs and study abroad courses don’t count.

The workforce Pell Grant is the result of “one of the only bipartisan conversations that we’ve seen Congress have in the student aid arena in the past few years,” Walter says. “Actually seeing it go through was pretty surprising.”

Timing, impact and next steps

The workforce Pell Grant will be available starting July 1, 2026.

You must submit the Free Application for Federal Student Aid (FAFSA) to qualify for the Pell Grant. Unlike a loan, you don’t need to pay the Pell Grant back.

If you’re considering using your Pell money for a short-term workforce training program, thoroughly research programs to avoid scams.

5. Stricter limits on forbearance, deferment and other relief options

Future borrowers will find it more difficult to get temporary student loan relief through deferment (a payment pause during which interest does not accrue on subsidized loans) and forbearance (a payment pause in which interest does usually accrue on all loans).

Deferments for unemployment and economic hardships will be eliminated entirely. These two deferment programs had allowed borrowers to pause payments for up to three years.

Forbearances to pause payments will be limited to nine months in any 24-month period. Previous rules were more generous: borrowers could request forbearances of up to 12 months, renewable up to a cumulative maximum of three years.

Timing, impact and next steps

The deferment and forbearance restrictions impact borrowers who receive a new loan on or after July 1, 2027.

If you face a financial emergency, check if you qualify for the remaining types of student loan deferments, like those for cancer treatment, military service or returning to school. You can still ask your servicer for a forbearance, but only use what you need, since you have a limited amount available. If neither of those options work, see if IBR or RAP are options.

“We may see a rise in defaults and potentially bankruptcy filings down the road, simply because there’s a huge swath of people where Income-Based Repayment and RAP aren’t affordable under their scenarios,” Tate says. For example, borrowers who earn a high income but have substantial housing expenses could have trouble affording payments under these plans.

6. More difficult to get student loan forgiveness

It will take longer to get income-driven repayment plan forgiveness. Instead of reaching the forgiveness finish line in 20 or 25 years under existing IDR plans, new borrowers must make payments on the Repayment Assistance Plan plan for 30 years. (Parent PLUS borrowers won’t qualify for RAP, so they’ll be cut out from this type of forgiveness.)

The bill does not directly impact Public Service Loan Forgiveness (PSLF), which Trump targeted with a March executive order that hasn’t been implemented. An earlier version of the bill would have removed PSLF eligibility for medical and dental residents, but that provision was removed in the final version.

Timing, impact and next steps

This largely impacts borrowers with large amounts of debt relative to their income, who are good candidates for income-driven repayment forgiveness. If you’re a current borrower, switch to the IBR plan before 2028 to get forgiveness in 25 years, instead of 30 years under RAP.

7. Borrowers get second chance after repeat student loan default

Borrowers in student loan default can rehabilitate their loans a second time, returning them to good standing. Previously, student loan rehabilitation was a one-time deal.

That being said, the bill also removes guardrails that prevent borrowers from defaulting in the first place — like income-driven repayment and generous forbearance options.

Timing, impact and next steps

Second chance rehabilitation will open on July 1, 2027.

Roughly 10 million borrowers (1 in 4) could default by the end of this summer, according to an Education Department announcement from April. If you default on your student loans, reach out to the Default Resolution Group to make plans to get your loans back into good standing.

8. Families who own farms, businesses could get more financial aid

The FAFSA will no longer count the value of a family farm, small business or commercial fishery when calculating a student’s financial need. As a result, students from these families may qualify for more financial aid.

This reverses a FAFSA change from 2024, which added these assets to the financial aid formula.

Timing, impact and next steps

This FAFSA change will take effect on July 1, 2026, and be applied to all financial aid calculations starting in the 2026-27 academic year. It will impact a relatively small group of families — but for those affected, it can make a big difference, like making a student eligible for the Pell Grant, Walter says.

All students and families should submit the FAFSA each year they’re in school, even if they don’t think they’ll qualify for aid. The form opens the door to federal loans, grants, scholarships and work-study.

Eliza Haverstock writes for NerdWallet. Email: ehaverstock@nerdwallet.com. Twitter: @elizahaverstock.

The article 8 Major Student Loan Changes From Trump’s Budget Bill: Next Steps for Borrowers originally appeared on NerdWallet.

The investing information provided on this page is for educational purposes only. NerdWallet, Inc. does not offer advisory or brokerage services, nor does it recommend or advise investors to buy or sell particular stocks, securities or other investments.

James DeLapa and his wife live in San Diego, and together they earn mid six-figures at their tech jobs.

But in a high cost-of-living area, after paying for child care for their toddler daughter, and putting money away for retirement and college, they don’t feel flush with cash.

Among other things, DeLapa has a full-time nanny they pay as a household employee, taxes and all. And because they live in a fire-risk area, their homeowners insurance premium soared so high they had to make substantial changes to their deductible and coverage amounts.

“Costs go up on fixed items,” he says. “Your insurance goes up, your groceries go up, and it isn’t necessarily reflective of the raises and promotions, so we do have to regularly be mindful of what’s going on in our environment.”

Melody Morton-Buckleair, a single mom who owns two businesses in Texas, grosses more than $35,000 each month but isn’t able to save enough money for the future.

“On paper, it looks like I’ve ‘made it,’” says Morton-Buckleair, who runs two pilates studios. “But behind the scenes, I’m managing studio overhead, paying off high-interest debt from business growth, and covering everything for my two teenage boys.”

When earning more doesn’t feel like enough

Ed Silversmith, a certified financial planner in Pittsford, New York, refers to clients like these as HENRYs, which stands for “High Earners, Not Rich Yet.” In the U.S., nearly 1 in 7 households made $200,000 or more in 2023, according to the U.S. Census Bureau.

Some people in this category have high-earning jobs that require years of schooling and student loans, leaving them feeling like they’re behind their peers who’ve been working since they graduated from college.

Others make good salaries and battle lifestyle inflation.

“People get so excited when their salaries and bonuses are getting larger and they can finally live the lifestyle they want,” says Carla Adams, a CFP in Orion, Michigan.

They upsize their house or cars (or both), and by the time they add in retirement and college savings, child care and paying for children’s activities, they feel squeezed.

“They quickly find that it’s really easy to fall into this lifestyle trap,” Adams says.

If you’re a high earner with budget challenges, there are some strategies to regain control.

Crunch the numbers

Modeling future scenarios is a great way to ensure that you’re on track. Financial planners have access to software that does this, but there are retirement calculators online that can help.

“I try not to tell my clients how to spend their money, but rather run the long-term projections,” Adams says.

For instance, Adams might show a client that cutting their spending by $1,000 a month will make a meaningful difference in their retirement picture.

“Smaller changes now have an impact later on because of the power of compound returns,” Adams says.

Understand your spending

Spending is only a problem if it’s misaligned with your values or long-term goals, Silversmith says. Even if you make a sizable salary, tracking one month’s expenses can give you valuable insights.

Try a budgeting tool or spreadsheet to see where your money goes. If your spending isn’t compromising your future plans, Silversmith says, there’s no need for harsh self-judgment.

“The reality is, some people are going to look at the numbers and they’re going to walk away saying, ‘There are some places we can clean this up, but we really like the day care the kids go to,’” Silversmith says.

Right-size emergency funds

Larger-than-average emergency savings might be smart if you’re in a higher income tax bracket.

That’s because less of your income will be replaced by Social Security in retirement, assuming Social Security is still around, Adams says. And, if you have most of your savings in traditional retirement accounts, like 401(k)s or traditional IRAs, your withdrawals will be taxed at higher rates.

“The standard advice for people of any income is to be saving at least 10% to 15%,” Adams says. “High earners may need to be saving closer to 15% to 20%.”

Adopt a reverse budgeting approach

If you’re not going to track your expenses, consider automating your savings goals and using what’s left for day-to-day spending. That’s what Rob Schultz, a CFP in Encino, California, does with his clients, many of whom are physicians fresh out of training.

“We set out a target savings reserve and then put all the other required savings on autopilot,” Schultz says. This includes sending money toward kids’ college funds, student loans and retirement funds.

Avoid the ‘best case’ mentality

Build your financial plan around your base salary and be conservative about bonus or equity windfalls, the financial experts we talked to say.

“If you’re in real estate and you had a killer year, that doesn’t mean that for the next 10 years you’re able to inflation-adjust that amount and let your spending come up to meet that,” Silversmith says. There’s nothing wrong with rewarding yourself, but “you want to avoid lifestyle creep.”

On a similar note, don’t let a large salary motivate you to put off saving for retirement because you’re sure your income will keep going up.

“Unfortunately, if a layoff hits, it can take months or longer to find a comparable role, particularly at that income level,” Adams says.

Keep the big picture in mind

In the end, you have to live your life, so make decisions accordingly. If you don’t want to cut back on spending, you don’t have to — as long as you plan for it.

“If it fits in their career that they can work to 70, but they’re going to do all the things they want to do and they can do it when their kids are young,” Schultz says, “I have no problem with that.”

Kate Ashford, CSA® writes for NerdWallet. Email: kashford@nerdwallet.com. Twitter: @kateashford.

The article Making $200K and Still Feel Financially Stretched? You’re Not Alone originally appeared on NerdWallet.

My wife and I hate our washer and dryer. Both appliances still operate, but the washer leaves behind what looks like little specs of mildew every load. The dryer takes three times on high to get a load dry.

All the trade war talk has us wondering if we should nab a deal now while it doesn’t seem so bad.

A lot of people are worried about tariffs, according to the Consumer Confidence Board’s June Consumer Confidence Index. The report said purchasing plans for appliances were slightly up in June, car-buying plans were steady and electronic-buying plans were down.

The affluent — and I’m not saying that’s me — may be leading the charge.

Back in May, 26% of consumers making $125,000 or more indicated that they’d made purchases ahead of potential tariffs. Expected price rises haven’t fully landed, but economists say they are coming.

“Consumers are seeing their way through the uncertainty with trade policies,” National Retail Federation Chief Economist Jack Kleinhenz said in a June prepared statement. “But I expect the inflation associated with tariffs to be felt later this year.”

If you want to get ahead of potential rising prices, here are a few things to look at now before they get more expensive later.

Major appliances, like washers and refrigerators

Turns out the tariff on imported steel and aluminum will specifically hit household appliances. As of June 23, the 50% tariff on steel extends to “steel derivative products,” which include fridges, freezers, washers, dryers, dishwashers, ovens and even garbage disposals.

If you’ve been thinking about upgrading an appliance, the time might be right to get something that was made before prices get higher, and while summer sales are still going on.

As for our purchase plan, we’re going to get a new washer and dryer soon because mildew is gross and economists foresee prices rising. Our local appliance store has the LG set we want in stock and on sale now.

Cars (especially EVs and luxury imports)

It was a crappy time to buy a car the past few years. Prices of both new and used cars ballooned after the pandemic. Then, the situation seemed to get better.

Case and point: I bought a brand new Honda Odyssey at several grand under sticker in November. I was shocked the dealer was willing to let me haggle that day. (Adding free all-weather mats was a non-starter though.) I also can’t believe how much I love driving a minivan (#babyonboard).

Now, a 25% tariff on imported passenger vehicles and auto parts could usher in a new era of crappiness in car buying, but there is time to get ahead of it.

“Experts expect tariffs to push car prices higher. We’ve seen a few manufacturers increase prices, but overall there haven’t been big increases. That’s expected to change though, as pre-tariff vehicles disappear,” says Shannon Bradley, NerdWallet’s authority on autos.

What make and model of car are you after, and where is it made?

Consultancy firm Anderson Economic Group has analyzed vehicles with the lowest and highest potential tariff impact to project cost increases to consumers.

Cars like the Toyota Camry Hybrid, Ford Explorer and my beloved Honda Odyssey are assembled in the U.S. and expected to be less impacted by tariffs than more luxurious foreign-made models. Prices of the cars mentioned are expected to increase by $2,000 to $3,000.

Another incentive to get a new ride has to do with President Trump’s “big, beautiful bill.”

The legislation adds a tax deduction for car loan interest, where taxpayers can write off up to $10,000 a year in interest paid on new cars assembled in the U.S. and purchased after Dec. 31, 2024.

If you’re on the other end of the spectrum, looking for something like a Mercedes-Benz G-Wagon, Land Rover, Range Rover or imported BMW model, there’s no tax deduction, and the tariff impact is expected to be greater. Like $10,000 to $12,000 greater, according to the Anderson Economic Group analysis.

If you want an electric vehicle, the clock is ticking.

“EV tax credits will be eliminated beginning with EVs purchased or leased after Sept. 30, 2025. If you want an EV, buy one before then,” says Bradley.

The new Tesla Model 3 and Ford F-150 Lightning are examples of EV models eligible for the $7,500 EV tax credit for now. Used EVs get a tax credit of $4,000, but that will also end Sept. 30 under the planned tax changes.

iPhones and Androids

The tariffs situation changes almost daily.

Right now, there is a baseline 10% across-the-board tariff on all imports. There’s also a 30% tariff on Chinese imports in effect, with the potentially higher reciprocal tariffs on China and other countries on pause until Aug. 1.

Something you may not know is smartphones (along with 19 other electronic items and/or components, including laptops) are exempt from tariffs for the time being. That could influence your decision to upgrade your phone now, if you need to.

Imported booze

Does the idea of adding $12k to the cost of a luxury car make you reach for a drink? If so, you may want to stock up on Scotch, South African wine, sake and other imported alcohol and put them in the cellar now.

Unless new trade agreements come together, tariffs of 50% for the European Union, 30% for South Africa and 25% for Japan are on the table come Aug. 1.

Please drink expensive booze slowly and sparingly.

Advice: Don’t let tariffs tweak you out

Whatever you do, don’t panic-buy a fridge or a Ford F-150 Lightning because you’re worried. Saving money on the sticker price of something you don’t need or can’t afford is silly. Instead, assess your current situation and decide if your budget allows for buying something big-ticket.

It may be worth it to hold on to your money now and take steps to save and prepare for the additional cost later.

Tommy Tindall writes for NerdWallet. Email: ttindall@nerdwallet.com.

The article Splurge Now, Save Later? 4 Things to Buy Before Prices Rise originally appeared on NerdWallet.

Republicans cheered President Donald Trump’s signing of the “big, beautiful bill” on July 4 as “driving down energy costs.” But homeowners planning to install solar panels were hit with a tight deadline to claim thousands of dollars in tax credits.

In addition to slashing federal funding, the nearly 900-page bill eliminated the solar tax credit that homeowners could claim for installing solar panels on their properties.

Here’s what you need to know about the changes to the solar tax credit and how it’ll likely affect everyone — including those without solar panels.

What is the solar tax credit?

The solar tax credit, also known as the residential clean energy credit, reduces homeowners’ taxes if they install qualifying solar equipment. It essentially lets homeowners use money they would have paid in taxes to install solar energy systems. Taxpayers can claim up to 30% of the installation costs for new clean energy systems on their properties.

The incentive often makes the upfront costs of switching to renewable energy more affordable for homeowners, and it has saved Americans a lot of money. In fact, more than 1.2 million taxpayers claimed $6.3 billion with the residential energy tax credit during the 2023 tax year, according to the U.S. Treasury Department. Rooftop solar electricity systems represented 60% of those claims.

What’s changed for the solar tax credit?

The current version of the solar tax credit was introduced as part of former President Joe Biden’s Inflation Reduction Act of 2022, which continued a tax break for homeowners who installed solar panels through 2034. The IRS planned to phase out the credit starting in 2033 rather than end it abruptly.

However, Trump’s bill ends the solar tax credit on December 31, 2025 — cutting off nine years of potential savings for consumers who were considering certain renewable energy systems. The end-of-year deadline also drastically reduces the time people have to schedule qualifying installations.

Homeowners who want to claim the solar tax credit for the 2025 tax year need to make a financial transaction before the new December 31 deadline, says Hector Castaneda, a certified professional accountant and president of Castaneda CPA and Associates. That means either paying with cash or financing the purchase ahead of the deadline.

What this means for consumers

Ending the solar tax credit can have far-reaching ramifications for consumers — even those who never planned to switch to solar panels.

More expensive solar installations

The average installation costs for solar panels was $27,720 in early 2025, according to EnergySage, an online solar marketplace. The federal solar tax credit saved homeowners an average of $8,316, dropping the price to $19,404.

But anyone purchasing solar panels for their homes after 2025 will have to rely only on state-based incentives to save money. States vary in what incentives they offer, saving some residents money upfront with sales tax exemptions, or money over time with property tax exemptions. But even combined with local tax credits and rebates for solar installations, state incentives won’t make up for the thousands of dollars in savings homeowners will lose after 2025.

To complicate matters, solar panel costs were already becoming volatile before Trump rang the solar tax credit’s death knell. Tariffs on imported solar components and equipment began affecting the industry earlier this year, creating uncertainty about supply chain reliability and affordability.

Cal Morton, owner of EasTex Solar, a solar installer serving the East Texas region, says the tariffs kicked off a turbulent market for solar companies. “It was already the craziest year that I can think of,” Morton says.

Consumers quickly began to feel the effects of an unstable market. The average cost of residential solar energy systems increased 3% between the first quarters of 2024 and 2025, according to a June 2025 Wood Mackenzie report. Prices are likely to continue to rise, making the solar market more unsteady without the solar tax credit.

Longer payback periods for new systems

Homeowners who purchase solar panels without the benefits of the solar tax credit will likely pay a higher price tag. This translates to a longer gap between solar installation and breaking even with a system’s savings, also known as the payback period.

The average payback period for solar customers was just over seven years in early 2025, according to EnergySage. But homeowners in some areas were already looking at closer to 20 years before breaking even on their purchases. Price hikes and the loss of the tax credit will likely lengthen those payback periods.

Lease, PPA and battery trends

As homeowners back away from solar panel purchases, companies that offer leases and power purchase agreements (PPAs) are likely to become the major competitors, says Chris Hopper, co-founder and chief executive officer of Aurora Solar, a software platform that streamlines the solar array design process for installers.

Homeowners might be able to still save money after 2025 by leasing solar panels or entering a PPA before July 4, 2026, when solar companies’ tax credits change. These arrangements allow homeowners to generate solar energy without purchasing the equipment, while the companies that own the equipment receive a tax break. If a company passes on that tax break to the consumer, it can lower the overall cost of the system.

Additionally, the deadline changes don’t apply to solar battery purchases. Homeowners who purchase batteries to use as storage systems, such as pairing with a new or existing solar energy system, can claim a tax credit to offset up to 50% of the cost. The credit will begin to phase out in 2034 and end on December 31, 2035.

Less solar power and higher electricity bills

The elimination of the solar tax credit comes at the same time that the U.S. energy market is experiencing a growing demand for power, Hopper says. Solar energy has been helping with that demand. It was responsible for 69% of the new electricity-generating capacity that utility companies added to the U.S. power grid in the first quarter of 2025, according to the Wood Mackenzie report from June 2025.

Although commercial solar projects can continue to see tax benefits longer than residential systems, they tend to take longer to put into operation. The lengthy timeline means less solar energy production to support the growing need for more energy in the meantime.

Energy Innovation, a non-partisan think tank specializing in energy, climate research and policy analysis, estimates that the loss of that additional energy will raise the cost of electricity for consumers.

Janice DiPietro, chief integration and customer officer at ReVision Energy, a New England-based solar company, agrees. She cites the combination of new tariffs, the loss of the solar tax credit and the increased demand for power as primary factors.

“As a result, electricity rates will increase at a faster than average pace,” DiPietro said by email.

Whitney Vandiver writes for NerdWallet. Email: wvandiver@nerdwallet.com.

The article The Solar Tax Credit Is Ending: What That Means for Homeowners originally appeared on NerdWallet.

The GOP’s $3.3 trillion budget, dubbed the “big, beautiful bill,” includes $4.5 trillion in tax cuts and approximately $300 billion for President Donald Trump’s defense and immigration enforcement priorities. To partly offset the steep cost, the bill targets reductions across the board — but hits health and food assistance programs hardest.

Medicaid and the Supplemental Nutrition Assistance Program (SNAP) subsidies face deep cuts and work requirements. Affordable Care Act (ACA) subsidies will also be reduced. The burden of these cuts is expected to fall most heavily on existing and eligible recipients, as well as on state health programs, food banks and rural hospitals that depend on federal support to deliver services to vulnerable populations.

The timing of certain changes to social safety net programs isn’t entirely clear — the bill didn’t attach a specific implementation date for SNAP work requirements, for example, but it could be as early as this year. For Medicaid requirements, states have until the end of 2026 to begin enforcing. And the biggest cuts to Medicaid and SNAP won’t begin until 2028.

“We’re not all going to wake up one morning and find millions more people uninsured,” said Larry Levitt, executive vice president of health care policy for KFF, a health care policy and research organization, during a press call on July 9. He added that the impact of changes to Medicaid and the ACA will roll out slowly over the next decade.

With program restrictions and cuts looming, here are the people and programs who will feel the most pain.

People who rely on Medicaid for health care coverage

More than 78 million people are enrolled in Medicaid in 2025, according to Medicaid.gov, about 23% of the U.S. population. They include eligible low-income adults, pregnant women, children, older adults and people with disabilities.

The bill’s changes to Medicaid will unfold in two phases.

First, states must enact work requirements by the end of 2026, according to the bill. To stay enrolled in Medicaid, recipients must demonstrate they are working, caring for small children, attending school or work training at least 80 hours per month.

And yet, KFF finds that most people under the age of 65 who receive Medicaid are already working full-time or part-time or attending school. So it’s not lack of work or schooling that would push Medicaid enrollees off their health care coverage, it’s the complex red tape that the new requirements introduce.

That is, at least, how it worked when Arkansas tried to do it.

Arkansas briefly implemented 80-hour-per-month Medicaid work requirements for enrollees ages 30 to 49. The restriction was in place from June 2018 to March 2019, when a federal court struck it down. During that time, 18,000 people — about 25% of the covered population — lost health care coverage, according to a September 2020 study from Harvard T.H. Chan School of Public Health. The losses were largely due to failures in reporting or documentation, not ineligibility.

Moreover, the policy had no effect on employment in the 18 months following the end of the program. But there were significant health and financial consequences for those who lost coverage, compared to those who remained on Medicaid: Nearly 50% reported serious medical debt problems, while 56% delayed health care and 64% delayed taking medications, both due to cost.

At the highest risk for losing coverage are those with chronic illness or disabilities who cannot obtain exemptions; those with mental health conditions; and those whose work hours fluctuate from one month to the next, such as seasonal or gig workers. The Congressional Budget Office (CBO) estimates that 5.2 million adults will lose Medicaid due to work requirement restrictions.

The second rollout of Medicaid changes won’t begin until 2028, but those are the deepest cuts. Provisions include new cost-sharing charges between states and low-income working enrollees for certain health care services. The changes also require states to end non-Medicaid health care coverage for immigrants.

A June 24 assessment by the Congressional Budget Office projects that as a result of all the changes to Medicaid and the ACA (more on that below), approximately 12 million will lose health care coverage.

People who have health coverage through ACA marketplaces

Changes to ACA requirements and subsidies could result in 8.2 million people losing health care coverage through ACA marketplaces, according to CBO estimates.

The first set of changes are stricter requirements: Those who access health care through the ACA marketplace face new annual update conditions for income and immigration status. They’ll also face a shorter window to enroll each year.

The most significant impact is what’s missing from the bill: An extension of the enhanced premium tax credits for ACA marketplace coverage, put in place during the pandemic, which expire at the end of the year. Premium tax credits are a federal subsidy that helps cover monthly premium costs for those who purchase health insurance through the ACA marketplace.

If enhanced tax credits expire, out-of-pocket premiums in the marketplace could increase by more than 75% and up to 90% in rural areas, according to KFF CEO Drew Altman, during the press call. He also said that enrollment could drop as much as 50% in rural areas.

Levitt added that the measures in the bill amount to “what is effectively a partial repeal of the ACA,” which passed 15 years ago. Federal data shows an estimated 45 million people are enrolled in health coverage through the ACA — about 13% of the U.S. population.

State health programs and rural hospitals

Federal cuts to Medicaid and the ACA will shift financial responsibilities onto states, which is likely to add financial strain to state health programs and hospitals — particularly community health centers and rural hospitals.

For decades, states have used provider taxes to help fund Medicaid and state-directed payments. The bill limits how states can do so.

Robin Rudowitz, vice president at KFF and director of the Program on Medicaid and the Uninsured, said during the press call that if states are limited in how they can use provider taxes, they’ll have to come up with other ways to replace that money like increased taxes, cuts to other program spending or further changes to their Medicaid programs.

The cuts would also mean hospitals will receive lower payments, which means hospitals may have to scale back certain services or close altogether. Hospitals with low margins, like rural hospitals, are likely to face the biggest obstacles.

KFF estimates that 12 states with large rural populations and expanded Medicaid could see federal spending on their programs decline by $5 billion or more over 10 years. Kentucky stands to lose $12 billion — the highest among all states.

Kentucky, for example, relies heavily on provider taxes. Kentucky Hospital Association, which represents over 100 hospitals in the state, says the bill’s cuts puts 20,000 people at risk of losing their jobs. A study from University of North Carolina found that 35 rural hospitals in Kentucky could be in danger of closing due to the provisions in the bill.

There is one source of hope for rural hospitals in the bill: States may apply to access a $50 billion fund to support rural hospitals, to be distributed for five years beginning in 2027. But the fund won’t likely offset the cuts. Levitt said “Delayed relief, even if sizable, won’t arrive fast enough to prevent closures.”

People who need food assistance

As with Medicaid, low-income Americans who are eligible for SNAP will face new work requirements as soon as this year and the effects of funding cuts later in 2028. The total reduction in SNAP spending in the bill: $295 billion over the next decade.

More than 42 million people receive SNAP benefits, according to the USDA — about 12% of the U.S. population.

It’s worth noting that there are already work requirements built into the SNAP program — able-bodied people without dependents, ages 18 to 49, must work at least 20 hours per week or 80 hours per month. But the bill raises that upper age limit to 55, which means millions more people will be impacted. It also eliminates or tightens exemption criteria for states to waive work requirements for certain individuals.

The issues that SNAP work requirements present remain, according to the Center on Budget and Policy Priorities (CBPP): increased administrative burdens, more people losing assistance and no improvements in long-term employment outcomes.

While food banks don’t directly rely on SNAP to deliver its services, a loss of SNAP funds could put added pressure on already-strained programs. Feeding America, a nationwide network of food banks, estimates the bill’s provisions could reduce anywhere from 6 to 9 billion meals annually.

More From NerdWallet

• Splurge Now, Save Later? 4 Things to Buy Before Prices Rise
• 7 Ways to Keep the Summer Spending Craze Under Control
• Making $200K and Still Feel Financially Stretched? You’re Not Alone

Anna Helhoski writes for NerdWallet. Email: anna@nerdwallet.com. Twitter: @AnnaHelhoski.

The article Without a Net: Who Will Feel the Pain From Budget Cuts? originally appeared on NerdWallet.

“We have expenses in summer that we might not have the rest of the year,” says April Stewart, a financial coach who helps high earners take control of their money and build wealth.

“A lot of times we tend to overspend when we aren’t intentional,” she adds.

Stewart and other money experts say there’s still time to reign in expenses this summer — or as you plan ahead for next summer. Here’s how:

1. Decide where you want your money to go

“Get clear on how you like to spend money,” says Keina Newell, a financial coach who specializes in helping single women.

You want to plan for not only your bills, but also the fun summer expenditures, she says. “Let’s look at how you want to spend your time, maybe engage in experiences, dining outside more.”

To help you reflect, she suggests looking back on what you enjoyed spending money on over the past year, and what you didn’t. Where did you get the best return on investment?

Those are areas you may want to prioritize in favor of other things.

Setting a budget for those fun activities gives you permission to spend and enjoy the season while also erecting guardrails so you don’t spend more than you intend, Newell says. It’s an approach she likes to call “permission budgeting.”

2. Map out (and plan for) big expenses

Knowing what you want to buy in advance gives you a chance to set aside cash to fund those expenditures.

You can use a budget spreadsheet to get started. Estimate upcoming expenses — including the ones that go up in the summertime — such as travel, family celebrations, air conditioning bills and summer camp expenses, Stewart says.

Stewart suggests including items like gifts for graduations and baby showers, along with the target spending amount, in your summer budget. Otherwise, she says, it’s easy to overspend by accident.

3. Build in a cushion

Even the best planners can get hit with unexpected costs in the summer months. Your air conditioning unit could break, your car could overheat or travel plans could go awry.

To prepare for those types of surprises, Stewart suggests leaving a cash cushion in your checking account. You could also create a separate savings account for these funds. That way, you won’t have to turn to credit card debt or other high-interest loans to fund emergencies.

“Create a summer savings account so you have money set aside,” she suggests.

While more savings are always better, even setting aside one or two hundred dollars can go a long way if you suddenly need the cash.

4. Just say ‘no’ to friends (sometimes)

If money is tight, your friends are probably in the same boat, Newell says.

Telling friends that you want to spend less could lead to a helpful conversation about ways to have fun on a budget. You could take turns hosting a potluck, skip a big group trip in favor of local fun or find a free concert instead of a ticketed venue.

Bringing up budgeting “doesn’t make you sound cheap,” Newell says, but helps normalize talking about money with friends, which can benefit everyone.

“It’s okay to say ‘no,’” Stewart says, when a friend asks you to spend money on an activity that you won’t enjoy.

“Set boundaries for yourself,” she says. And if an activity pops up that would require you to turn to credit card debt or dip into an emergency fund, then decline.

“If you can’t cash flow it, then it’s a no.”

5. Move on quickly from slip-ups

If you regret a splurge on a concert ticket or big night out, it’s OK — you can still recover and learn from the mistake.

“Your spending is all data,” Newell says. Review it and reflect on it to learn from slip-ups.

Cataloguing what happened so you can make a different choice next time turns the experience into something useful instead of just a sunk cost, she says.

6. Avoid spending triggers

When you reflect on your spending, you might notice certain triggers that cause you to spend more.

Late night doomscrolling might lead to online shopping, for example, so you could opt to skip the scrolling when you’re tired, Newell says.

Severine Bryan, an accredited financial counselor who helps women rebuild after divorce and other challenges, says she’s learned to be on guard against overspending on rainy days.

“I just want some comfort food,” she says, when the drops start falling.

Instead of ordering expensive takeout on a recent rainy day, Bryan opted to pick up soup at a local chain restaurant. It satisfied her craving in an affordable way.

Finding an affordable alternative to an expensive desire can keep summer spending in check, Bryan says.

“Sometimes it’s OK to get that thing at a lesser price point,” she says. “I’m not going to spend $50, but I will spend $10 to satisfy that craving.”

Similarly, if you want a summer vacation but it’s outside your budget this year, you could plan a fun staycation instead, Bryan adds.

“We want to find a nice sweet spot where you’re enjoying your life but with a goal in mind.”

7. Seek out free fun

The upside of summer is that it comes with many free activities, Bryan says. Local parks, libraries and community centers often offer free entertainment, including volunteering opportunities.

“Not only are you enjoying yourself, but you’re creating memories,” she says, for yourself and for others.

Kimberly Palmer writes for NerdWallet. Email: kpalmer@nerdwallet.com. Twitter: @kimberlypalmer.

The article 7 Ways to Keep the Summer Spending Craze Under Control originally appeared on NerdWallet.

If you have a marketplace health insurance plan, sometimes also known as Obamacare or Affordable Care Act (ACA) plans, your premiums might go up, and you might need to do more work to stay eligible.

Here are a few key changes to marketplace health insurance in the new law — plus one thing that went unaddressed — and what to do about them.

» MORE: What the ‘big, beautiful bill’ means for your finances

1. Premiums might get much pricier

How it works now: Premium tax credits help taxpayers afford marketplace health insurance premiums. Since 2021, “enhanced” premium tax credits have been larger and available to more people.

In states using HealthCare.gov, enhanced tax credits made subsidized premiums about $624 less expensive per year in 2024. That’s according to estimates by KFF, a health policy nonprofit.

Enhanced subsidies are set to expire after 2025. Smaller tax credits — and therefore more expensive premiums — go back into effect starting in 2026.

What’s changing: The new law was an opportunity for Congress to extend the enhanced subsidies. It did not.

If the enhanced subsidies expire, marketplace health insurance members at all income levels will pay more. Net premiums would rise by 25% to 100%, depending on income, according to estimates by the Commonwealth Fund, a health care policy think tank.

Expiring subsidies would lead to 4.2 million more people without health insurance by 2034, according to the nonpartisan Congressional Budget Office.

What to do about it: It’s still possible for Congress to extend the enhanced subsidies before they expire. You can contact your members of Congress about potential changes.

If subsidies expire, you might need to budget for higher premiums. You could also consider other ways to get health insurance if marketplace plans are no longer affordable.

2. You’ll need to re-enroll for subsidies every year

How it works now: Currently, people with marketplace health insurance are automatically re-enrolled for the next year. You can also stay eligible for premium tax credits and cost-sharing reductions. Eligibility is automatically checked using your original application information and updated tax data.

Nearly 11 million people were automatically re-enrolled in health insurance marketplace plans for 2025, according to the Centers for Medicare & Medicaid Services. That’s about 44% of total members.

What’s changing: Under the new law, your eligibility for premium tax credits and/or cost-sharing reductions doesn’t carry over from year to year.

To keep those subsidies, you’ll need to re-verify your eligibility. Otherwise, your premiums and/or out-of-pocket costs will go up — potentially by hundreds of dollars per month.

Changes go into effect starting in tax year 2028.

What to do about it: Take action each year during open enrollment, even if you want to keep the same plan. To keep your subsidies, be ready to provide information about:

• Household income.
• Family size.
• Address.
• Immigration status.
• Other health coverage you have or are eligible for.

3. Enrollment will be more restricted for people with low income

How it works now: If your income is at or below 150% of the federal poverty level (FPL), you have a year-round special enrollment period. That means you can sign up for marketplace health insurance any time without waiting for open enrollment. You can also qualify for premium tax credits and cost-sharing reductions.

What’s changing: Under the new law, if you apply during this income-based special enrollment period, you can’t qualify for premium tax credits or cost-sharing reductions. (Other types of special enrollment periods are unchanged.)

The change takes effect starting in the 2026 plan year.

What to do about it: If possible, plan to apply for coverage during open enrollment. Open enrollment in most states runs from Nov. 1 to Jan. 15. (Some state marketplaces use different dates.)

If you enroll under a different kind of special enrollment period, you could get subsidies. For example, you might qualify if you’ve lost other health coverage, moved, gotten married or divorced, or had a baby.

4. Some immigrants will lose premium tax credits

How it works now: Lawfully present immigrants can get marketplace health insurance plans. They can also qualify for subsidies.

What’s changing: Under the new law, only certain categories of immigrants qualify for marketplace coverage and subsidies:

• Lawful permanent residents (green card holders).
• Certain Cuban and Haitian immigrants.
• Immigrants covered by a Compact of Free Association.

Others no longer qualify, even if lawfully present. Examples could include refugees, asylees and people with temporary protected status. Changes take effect starting in tax year 2027.

What to do about it: Check whether your immigration status makes you eligible for coverage and subsidies. If not, you might need to find another source of insurance.

5. Advance premium tax credits will be riskier

How it works now: Advance premium tax credits pay for some or all of your health insurance premiums. Credit amounts are based on your estimated annual income.

It’s possible for your actual income to end up higher than the estimate. If that happens, you qualify for smaller tax credits and have to pay the IRS back for the difference.

You might not have to repay the full amount. There are caps based on income. For example, an individual with income below 200% of the FPL would repay no more than $375 for 2024, according to the IRS.

What’s changing: Under the new law, there’s no cap on premium tax credit repayments. People with low or no income will have to repay the full difference in amounts starting in tax year 2026.

What to do about it: Provide the best information you can on your application about your expected income. The more accurate your estimated income, the less you might have to repay.

You can choose not to take the premium tax credit in advance. Instead, you can get the credit when you file taxes. In that case, you’d avoid the possibility of needing to repay it later. But paying full, unsubsidized premiums each month could be very expensive.

“You should be aware that the IRS routinely works with taxpayers who owe amounts they cannot afford to pay,” according to the IRS website. Consider contacting the IRS to make a payment arrangement.

Alex Rosenberg writes for NerdWallet. Email: arosenberg@nerdwallet.com.

The article 5 ‘Big, Beautiful Bill’ Changes to Marketplace Insurance originally appeared on NerdWallet.

The investing information provided on this page is for educational purposes only. NerdWallet, Inc. does not offer advisory or brokerage services, nor does it recommend or advise investors to buy or sell particular stocks, securities or other investments.

President Donald Trump’s “one big, beautiful bill” is launching a new way to save for children’s futures: the “Trump Account.” This investment account gives kids who meet certain requirements $1,000 courtesy of the federal government.

But a Trump Account may not be a superior replacement for existing investment tools just yet.

What is a Trump Account?

Formerly called “Money Accounts for Growth and Advancement,” or “MAGA accounts,” the Trump Account is a special trust designed to give children a head start financially. Money contributed to these accounts gets invested in the stock market.

The Trump Accounts Contribution Pilot Program starts eligible kids off with a one-time $1,000 credit. The money comes from the Department of the Treasury.

Who qualifies?

Not every kid can get a Trump Account. To be eligible for the $1,000 credit under the pilot program, children must:

• Be born between Jan. 1, 2025, and Dec. 31, 2028.
• Be a U.S. citizen.
• Have a Social Security number.

How do Trump Accounts work?

Getting started

Under the pilot program, the Treasury will set up accounts for qualifying kids if their parents haven’t already done so. Parents aren’t required to make an election.

How do contributions and withdrawals work?

Trump Accounts come with some restrictions. Contributions made before the calendar year in which the beneficiary turns 18 are limited to $5,000 per year. Employers can contribute up to $2,500 to accounts, which won’t count as income for the parents or children.

Trump Account distributions aren’t allowed before the first day of the calendar year the child turns 18.

Contributions made after the child’s 18th year generally follow traditional IRA rules. The IRA contribution limit in 2025 is $7,000 for those under age 50. The money invested grows tax-deferred, and withdrawals are taxed as ordinary income.

There’s a 10% penalty for withdrawing money from an IRA before age 59 ½, unless there’s a qualifying exception, such as homebuying, or paying for higher education expenses.

What about taxes?

Contributions made to Trump Accounts before the child’s 18th birth year must be made with after-tax dollars, which means no tax deduction for parents or employers, said Jacob Martin, a certified financial planner in Columbus, Ohio, in an email interview.

Contributions made during the 18th birth year and after could be deductible.

How do they compare with existing investment vehicles?

Trump Accounts have perks, but there are other long-term investment and college savings strategies that bring more to the table, financial experts say. Let’s explore a couple of options further.

Trump Accounts resemble traditional IRAs, except contributions made before the beneficiary’s 18th birth year aren’t deductible and have a lower annual cap. Unlike an IRA, there’s no earned income requirement to start.

Brokerage accounts, including UTMA & UGMA custodial accounts, don’t have contribution or withdrawal limits.

A 529 plan offers more flexibility than a Trump Account when it comes to who can open an account and use the money. For example, account holders can change beneficiaries, or roll funds from one family member’s plan to another.

While the exact amount varies by state, contribution limits for 529 education savings plans are high. Contributions grow tax-free, and withdrawals are tax-free when made for qualifying expenses. Some plans offer state residents tax deductions. You can also roll over unused money, up to a certain amount, into a Roth IRA.

Is a Trump Account worth it?

If your child can get the $1,000 credit, consider it, Robert Persichitte, a CFP in Arvada, Colorado, said in an email interview.

“If it’s free money, great. Take what you can get,” he said.

A Trump Account gives children the ability to start investing early with a little seed money. It could help establish a fund your kid could put toward buying a home or starting a business someday.

But for most taxpayers, Roth IRAs and 529 accounts are likely the better options because they offer much better tax savings, Persichitte said.

Other investment accounts, including IRAs, 529s and other custodial accounts, also allow higher contribution limits, which could help you save a larger amount over the long term.

Lauren Schwahn writes for NerdWallet. Email: lschwahn@nerdwallet.com. Twitter: @lauren_schwahn.

The article $1K ‘Trump Accounts’ for Kids: How Do They Stack Up? originally appeared on NerdWallet.

The GOP-led Congress is walking a political tightrope with the rollout of key provisions in Trump’s “one big, beautiful” bill, passed last week.

With next year’s midterms looming, strategic timing is everything: tax breaks to households (and corporations) begin in 2025, while most sweeping social program cuts are delayed until 2028. Learn more about what’s in the budget here.

Here’s a rundown of when the budget provisions that could most affect your household will begin:

Tax cuts and incentives

• Extension of the 2017 marginal tax rates: Trump’s 2017 tax cuts for individuals and corporations were set to expire at the end of the year, but have now been made permanent, effective immediately.
• State and Local Tax (SALT) cap increases: The SALT cap rises to $40,000, beginning in the 2025 filing year, but will revert back to $10,000 in 2028. The SALT deduction is only available to taxpayers who itemize.
• Increased standard deduction: The current standard deduction — which was doubled by Trump’s tax cuts in 2017 — is made permanent. Starting in 2025, single filers can deduct an additional $750, while married couples can deduct $1,500. The additional deduction amounts will adjust to inflation beginning in 2026. The increases phase out for those with higher incomes.
• Standard deduction increase for seniors: Starting in 2025 and expiring after 2028,, those 65 and older who earn less than $75,000 annually can deduct an extra $6,000 ($12,000 for married couples) on top of the standard deduction.
• Child tax credit: Increases — and makes permanent — the child tax credit to $2,200 for the 2025 tax year. The credit amount adjusts for inflation moving forward.
• No taxes on tips: Tipped income under $25,000 per year will be tax-deductible starting with the 2025 filing year. The provision expires after 2028.
• No tax on overtime: Overtime pay can be deducted — up to $12,500 for individual filers or $25,000 for married couples filing jointly — beginning with the 2025 tax year. The provision phases out for those with income above $150,000 or $300,000 for couples. It ends in 2028.
• Auto loan interest exemption for new vehicles: Allows a deduction of up to $10,000 in interest on loans for new car purchases. Begins 2025 and sunsets in 2028.
• Home energy tax credits: End after Dec. 31, 2025.
• Electric vehicle tax credits: End Sept. 30, 2025.
• “Trump Accounts”: Babies born between Jan. 1, 2025 and Dec. 31, 2028 will be automatically enrolled in a “Trump Account” with a one-time $1,000 federal contribution.
• Section 179 deduction: Small businesses can write off 100% of equipment and certain commercial property costs in the first year, effective Jan. 19, 2025. It also raises the deduction cap on property expenses to $2.5 million, beginning Dec. 31, 2024.
• 1099-K reporting threshold restoration: Reverts the threshold for online sales reporting to $20,000 or 200 transactions per year, as it was before 2021. The provision is applied retroactively to 2022.

Social program cuts

• Medicaid work requirements: Recipients must verify 80 hours per month of work, school, work training or volunteering. States must implement the new requirements by Dec. 31, 2026.
• Supplemental Nutrition Assistance Program (SNAP) work requirements: Expands work requirements to able-bodied recipients, ages 18 to 64 (up from 54). The requirements include those with children older than 6. Timing isn’t clear, but changes may begin sometime this year.
• Medicaid cuts: Medicaid funding reductions begin in 2028. The Congressional Budget Office projects nearly $1 trillion in cuts over a 10-year period; it could leave some 11.8 million people losing health care coverage.
• SNAP cuts: Up to $230 million in SNAP food assistance cuts over 10 years, beginning in 2028.
• Affordable Care Act (ACA) rule changes: Tighter ACA enrollment rules roll out between 2025 to 2028, depending on the specific provision.

Consumer protection cuts

• Funding cuts for the Consumer Financial Protection Bureau (CFPB): Funding for the CFPB is cut in half, effective immediately. The CFPB oversees the consumer finance industry.
• Current federal student loan borrower repayment plans: Existing income-driven federal student loan repayment plans will sunset by July 1, 2028. This includes forgiveness under these repayment plans.
• New repayment plan for student loan borrowers begins: Enrollment in a new Repayment Assistance Program begins July 1, 2026. It is an income-driven plan that requires a $10 minimum monthly payment for borrowers and extends the timeline for forgiveness to 30 years.
• Graduate PLUS loan program: Funding for Graduate PLUS loans program sunsets as of July 1, 2026. Lifetime borrowing for graduate studies is also capped.
• Parent PLUS loan program: Implements a $65,000 cap on Parent Plus loans as of July 1, 2026.

Anna Helhoski writes for NerdWallet. Email: anna@nerdwallet.com. Twitter: @AnnaHelhoski.

The article When Do ‘Big, Beautiful’ Megabill Changes Go Into Effect? originally appeared on NerdWallet.

The almost 900-page “big, beautiful bill” has plenty to say about taxes, and an array of changes, new credits and deductions are part of the new bill. But at its heart, the bill is about extending the tax provisions passed under the Tax Cuts and Jobs Act (TCJA) of 2017, during Trump’s first administration.

Many 2017 tax cuts now permanent

“You know, everyone’s focused on changing this and changing that, but the main point of this law was to extend or make permanent a lot of the provisions that were in the 2017 Tax Cuts and Jobs Act,” says Evan Morgan, a CPA and principal in tax advisory services at Kaufman Rossin, a Miami-based accounting firm.

The clock was ticking on many of the 2017 changes, which were set to revert to earlier levels at the end of 2025.

“They were due to expire and go back to a higher rate,” Morgan says. “They said, ‘No, no, we’re going to make that permanent.’”

Tax brackets

In tax year 2017, tax rates ranged from 10% to 39.6%. The TJCA lowered the top rate, for top earners, to 37%. That range is now made permanent in the “big, beautiful bill,” which also makes provisions to adjust certain income thresholds — or brackets — for inflation in future years.

Standard deduction

Increases in the standard deduction enacted in 2017 were also due to expire, and the new bill not only makes them permanent, but raises them again and makes them active in tax year 2025 (for taxes filed in 2026).

The new standard deduction levels are:

• Single filers and married filing separately: Increases from $15,000 to $15,750.
• Married filing jointly: Increases from $30,000 to $31,500.
• Heads of household: Increases from $22,500 to $23,625.

In tax year 2017, before the TCJA, standard deductions were $6,350 for individuals, $12,700 for those married filing jointly and $9,350 for heads of household.

State and local tax deduction

Before the TJCA, there was no cap on the amount a taxpayer could deduct for certain state and local taxes paid. The 2017 act set a $10,000 cap, set to expire at the end of 2025 — and then revert to no cap.

The new bill sets a new cap at $40,000 in tax year 2025, rising 1% to $40,400 in 2026. In tax year 2029, it reverts to $10,000.

The state and local (SALT) deduction is available only for taxpayers who itemize rather than take the standard deduction, and there are limitations for high earners. Still, it can be worth exploring, particularly for homeowners.

“Even in a non-tax state like Florida, it doesn’t take that expensive of a home to get you to $10,000 in property taxes,” says Morgan. “Now that limit has been raised from 10 to 40.”

Child tax credit

In 2017, the TCJA temporarily raised the maximum child tax credit from $1,000 to $2,000. The credit was due to revert to $1,000 at the end of this year. The legislation raises the maximum credit to $2,200 for the current year, adjusts it for inflation going forward, and makes it permanent.

What’s new in the ‘big, beautiful bill’?

Senior deduction

During his campaign, Trump pledged to eliminate income taxes some Americans over 65 pay on their Social Security benefits. Instead, the bill adds a new deduction for qualifying taxpayers:

• $6,000 for eligible individuals.
• $12,000 for married couples filing jointly if both spouses are 65 or older.

The deduction is temporary, ending after tax year 2028, and is layered on top of the standard deduction available to all taxpayers and the additional senior standard deduction. To get the full deduction, eligible taxpayers must have $75,000 or less in modified adjusted gross income ($150,000 or less for joint filers).

No taxes on tips/overtime

Trump also campaigned on ending taxes on tips and overtime, and the new legislation enacts both pledges — temporarily. Unless Congress takes further action, these provisions will expire after tax year 2028. Both take effect this tax year (for taxes filed in 2026).

On tips:

• Taxpayers will be allowed to deduct up to $25,000 in “qualified” tips from their income.
• Tipped workers will still be on the hook for payroll taxes, which fund Social Security and Medicare.
• There are limitations on industries included, as well as a gradual phaseout of the deduction above certain modified adjusted gross income thresholds ($150,000 for individuals; $300,000 for couples).

On overtime:

• Taxpayers will be allowed to deduct up to $12,500 against their overtime pay. This doubles to $25,000 for qualified joint filers.
• The deduction applies to any amount paid over the worker’s base pay.
• The deduction is reduced after the same thresholds as the tips provision.

Deduction for car loan interest

This deduction is designed to boost U.S. auto manufacturing, so there are built-in limits on qualifying. This deduction is available starting in tax year 2025 (taxes filed in 2026) and expires after tax year 2028.

The basics:

• Taxpayers can write off up to $10,000 a year in interest paid on qualifying auto loans.
• Taxpayers don’t have to itemize to claim the deduction.

The restrictions:

• The car must be new and purchased after Dec. 31, 2024.
• The car must be assembled in the United States.
• The deduction is reduced — potentially down to $0 — for individuals earning more than $100,000 per year (or joint filers earning more than $200,000).

Tax breaks for small businesses

There are numerous tax provisions in the bill that affect businesses of all sizes, including small businesses.

“The two biggest ones that we’re going to deal with is the restoration of bonus depreciation and the enhancement of Section 179 expense for businesses that buy fixed assets,” says Morgan, who specializes in working with small businesses.

Changes to the bonus depreciation will allow businesses to deduct 100% of the cost of new “qualified property” (certain kinds of machinery and other “short-lived” assets) acquired after Jan. 19, 2025.

The TCJA set a 100% deduction back in 2017, but it began phasing out in 2022. Before the latest changes, the deduction would have been 40% in the current tax year.

“So in other words, if I spent a million dollars on things like computers and desks and chairs and furniture and fixtures, as a business, I was only going to get a 40% bonus appreciation deduction in 2025,” says Morgan. “That has now been changed retroactively … and it’s gone back to 100%. So that’s going to be pretty big.”

Section 179 allows businesses to deduct the cost of certain assets at full value, rather than a depreciated cost. The “big, beautiful bill” raises the limit for this kind of deduction from $1 million to $2.5 million.

There are many more changes that have impacts for business owners, and there are nuances to the two changes listed above. For details, business owners should consult with a tax advisor.

Good news for online sellers

Morgan did highlight one additional change that will be of interest to those who sell items online through platforms like Etsy, Venmo and eBay.

The threshold for reporting sales was reduced to $600 annually in the American Rescue Plan of 2021, though implementation of the new limit had been delayed.

The new budget bill reinstates the previous reporting limits of $20,000 and 200 transactions.

What’s going away?

While the “big, beautiful bill” is almost entirely focused on cutting taxes, some tax credits are going away — primarily in the realm of clean energy.

• The $7,500 federal tax credit for purchasing a new electric vehicle and the $4,000 tax credit for purchasing used EVs, will both end on Sept. 30, 2025.
• Two clean energy tax credits, which together allow homeowners to claim a tax credit for rooftop solar, geothermal heat pumps or other green energy devices, will end after 2025.

A lot of changes — with a smaller IRS

Many new tax changes will require the IRS to develop new internal rules and guidelines — at a time when the agency is rapidly losing staff and funding. As part of the new administration’s push to trim the federal workforce, the IRS workforce has already decreased by more than 25% and further cuts are planned.

Rick VanderKnyff writes for NerdWallet. Email: rvanderknyff@nerdwallet.com.

The article The GOP Megabill: What Taxpayers Should Know originally appeared on NerdWallet.