Big, Beautiful Bill: What new tax changes mean for American families

A sweeping new tax and spending package, officially titled the Big, Beautiful Bill, is shaping the future of federal tax policy with long-term implications for Americans.

Steve Wyett, chief investment strategist at BOK Financial, joined News On 6 to break down the financial impact.

“The biggest headline is that what this does is it extends the tax rates,” Wyett said. “All of the brackets that we had from the 2017 tax cut bill had this not happened, we would have been looking at one of the biggest tax increases in the history of the United States.”

Wyett emphasized that both political parties expressed interest in preserving much of the 2017 tax framework during the last presidential election cycle.

“Both parties were talking about extending the material portion of this bill,” he said. “Nobody really wanted to see tax rates go back to where they were. That would have been a huge drag on economic performance.”

Additional Cuts Target Families and Seniors

The legislation includes enhancements aimed at working families and retirees. Among them are updates to the child tax credit and the standard deduction, which will now be tied to inflation.

“The child tax credit during the pandemic was doubled to $2,000,” Wyett explained. “It’s now increased to $2,200. And importantly for the child tax credit, it is now indexed to inflation, as is the standard deduction.”

The standard deduction is set to rise to $32,500, a shift that will affect most Americans. Seniors could also benefit from a $6,000 deduction on Social Security income when calculating modified adjusted gross income.

Other Tax Breaks Include Car Loan Deduction

The bill also introduces new deductions for specific purchases and life stages. That includes a deduction of up to $10,000 on loans for U.S.-made cars, further incentivizing domestic manufacturing and consumer spending.

“These are additional tax breaks that could be additive to economic growth going forward, with some important offsets there too,” Wyett said.

Tariffs Aimed at Offsetting Cost

To balance the bill’s projected cost, the administration is proposing a controversial funding strategy: tariff revenue.

“President Trump did throw in some additional tax breaks, that’s where the cost of the bill is coming from,” Wyett said. “The offset of that is tariff revenue. The president wants to use tariff revenue to reduce that. So the actual cost of this bill is going to be under; it’s under review.”

The final economic impact will depend largely on how the U.S. economy performs in the months ahead.

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