Main Takeaways from H.R. 1 – “One Big Beautiful Bill Act”

Background & Context

Fast-tracked via budget reconciliation to bypass the Senate filibuster.
Passed narrowly in the House and approved in the Senate with the Vice President casting the tie-breaking vote.

Fiscal & Deficit Impacts

Raises the debt ceiling by approximately $4–5 trillion.
The bill includes approximately $1.2 trillion in spending cuts over 10 years, primarily targeting programs like Medicaid, SNAP, and student loans.
Cuts are also funded by unwinding IRA energy investments, reducing clean-energy tax credits, and tightening financial regulations.

Social Safety Net Reductions

Medicaid: Adds work requirements for adults aged 19–64; projected to lead to loss of coverage for over 5 million people (official estimation, pls see Summary for estimation according to experts).
NOTE: Medicaid is a joint federal and state program that provides free or low-cost health coverage to millions of low-income Americans, including children, pregnant women, low-income adults, seniors, and people with disabilities.
SNAP: Tightens eligibility, raises work requirements to age 65, and shifts more cost burden to states.
NOTE: SNAP stands for the Supplemental Nutrition Assistance Program. It’s the largest federal nutrition assistance program in the United States, designed to help low-income individuals and families afford food.
Child Tax Credit: Increases to $2,500 per child through 2028 but excludes many low/moderate-income families.
NOTE: The Child Tax Credit (CTC) is a federal tax benefit that helps families with the cost of raising children by reducing the amount of income tax they owe, and in some cases, providing a refund even if no tax is due.

Education & Federal Employees

Eliminates interest-free subsidized federal student loans.
Creates “Workforce Pell Grants” for vocational training. NOTE: Workforce Pell Grants are federal grants for students enrolled in short-term, career-focused education or training programs—typically less than 15 weeks long. These grants are meant to help students quickly gain skills for employment without having to complete a traditional two- or four-year degree.
Ends annuity supplement for new federal retirees, “saving” about $10 billion over 10 years.

Agriculture

Defense & Border Enforcement

Provides an additional $144–150 billion in defense spending.
Allocates $70–79 billion for border enforcement, including wall construction and increased deportations.

Tax Provisions & Business Support

Makes the 23% pass-through business deduction permanent.
Reinstates 100% bonus depreciation and R&D expensing.
Raises the SALT deduction cap to $40,000 for joint filers.
NOTE: The SALT deduction lets taxpayers deduct state and local income, property, or sales taxes from their federal taxable income, reducing their overall tax bill—though the deduction is currently capped at $10,000 per year for most filers.
Reinstates a higher 1099-K reporting threshold and indexes the 1099-MISC limit to inflation.
NOTE: It raises the reporting threshold for 1099-K forms to $20,000 (up from $600) and 200 transactions, reducing tax paperwork for casual sellers, and adjusts the 1099-MISC reporting threshold annually for inflation.
Allows above-the-line deductions for overtime and tips for incomes under $160,000.
Expands HSA eligibility and supports employer-provided clinics.
Creates a tax credit for employer-provided childcare expenses.
Introduces CHOICE arrangements with fixed employer credits.
NOTE: The bill creates a new option called CHOICE arrangements that let small employers receive fixed tax credits—up to a set amount per month—to help cover health benefits they provide to employees.

AI, Judiciary & Federal Rule Changes

Imposes a 10-year federal moratorium on state-level AI regulations.
NOTE: States won’t be allowed to create their own AI rules for a decade, giving the federal government exclusive control—but this could slow local innovation or protections tailored to specific communities.
Limits judicial enforcement powers against federal officials.
NOTE: Courts will have less ability to hold federal officials accountable, potentially reducing checks on government actions and limiting legal remedies for misconduct.
Changes administrative rulemaking process, requiring Congressional approval for new revenue rules.
NOTE: The federal agencies must get Congress’s OK before implementing new tax or revenue rules, which could slow down or block timely updates to tax policy and increase political gridlock in rulemaking.

Environmental & Energy Policy

SUMMARY

Altogether, H.R. 1 is a comprehensive budget bill that:

Cuts taxes, especially for businesses and higher-income earners.
Increases defense and border security spending, while increasing the number of deportations.
Significantly reduces health and food assistance eligibility.
NOTE: Several sources report that up to 17 million people could lose Medicaid coverage due to new work requirements in the bill, which require most adults aged 19–64 to work, train, or volunteer at least 80 hours a month. While official estimates like those from the Congressional Budget Office project around 4.8 million losing coverage by 2034, experts warn the real number could be much higher because many people might struggle to meet reporting rules or claim exemptions. These changes aim to reduce federal Medicaid spending but could significantly affect low-income individuals.
Expands agricultural subsidies while cutting conservation.
Rolls back environmental protections and state AI regulations.
Reforms education and federal employee benefits.
Provides courts with less ability to hold federal officials accountable.