Trump’s “Big, Beautiful Bill” Explained: Student Loans, SNAP & Taxes

Ever wonder how one law could reshape everything from your student loans to your grocery bill? The newly signed “Big, Beautiful Bill” isn’t just about taxes—it’s a sweeping overhaul of student debt relief, Medicaid, food assistance, and clean energy.

If you're juggling tuition, benefits, or repayment plans, this law could affect your wallet in a big way. Let's break down what’s changing and who needs to pay close attention.

Key takeaways

• The newly signed Senate “megabill” repeals key Biden-era student loan forgiveness provisions
• Medicaid and SNAP face major cuts, including new work requirements and copays
• Several income-driven repayment plans will be phased out by 2026

What is the “Big, Beautiful Bill”?

Signed into law on July 4, 2025, President Trump’s nearly 900-page bill—nicknamed the “Big, Beautiful Bill”—delivers sweeping changes to taxes, federal spending, healthcare, and immigration.

It was passed along narrow party lines: 51-50 in the Senate (with Vice President JD Vance casting the tie-breaking vote) and 218-214 in the House.

While the bill focuses on making Trump’s 2017 tax cuts permanent, it also slashes social programs, restructures immigration enforcement, and undoes much of President Biden’s economic and climate agenda.

How does it affect student loan forgiveness and IDR plans?

The bill includes several provisions that could affect student loan forgiveness, especially for borrowers facing economic hardship:

• The newly introduced RAP income-driven repayment plan has a 30-year forgiveness timeline, longer than previous IDR plans.
• New rules could make it harder for students to have their loans discharged in the event that their school defrauds or misleads them.
• Finally, borrowers who take out loans after July 2027 will not be able to use economic hardship deferments to avoid making payments.

Most notably, several different income-driven repayment plans, including ICR, SAVE, and PAYE, are set to be phased out starting in 2026.

Borrowers will be shifted to revised IDR plans that require higher monthly payments and provide no interest subsidies.

Public Service Loan Forgiveness (PSLF) remains intact; however, the rules for qualifying for PSLF are expected to tighten through future regulations.

TuitionHero Tip

If you're on SAVE or pursuing PSLF, make sure to download your records and verify your payment count before new rules go into effect.

What happens to Medicaid and food assistance programs?

To fund tax cuts and border control expansion, the bill includes nearly $1 trillion in cuts to Medicaid, SNAP, and related safety net programs:

• New 80-hour/month work requirement for many Medicaid and SNAP recipients, including adults up to age 65.
• $35 co-payments for Medicaid patients across many non-emergency services.
• State cost-sharing mandates for SNAP starting in 2028, with penalties for high error rates.

The Congressional Budget Office estimates:

• 11.8 million people will lose health insurance by 2034 due to these changes.
• 3 million more will lose SNAP (food stamp) benefits.

Most Medicaid users already work, and critics argue the work requirements are burdensome and poorly targeted.

TuitionHero Tip

Students who use Medicaid or food assistance may now need to report work hours or seek exemptions. Talk to your state benefits office.

Who benefits most from the tax changes?

The bill locks in the 2017 tax rates and delivers $5 trillion in tax cuts, including:

• $12,000 average tax savings for the wealthiest households
• $2,200 child tax credit, up from $2,000
• Temporary deductions for tips, overtime, and auto loan interest
• A $6,000 deduction for older adults earning under $75K

But the poorest Americans are projected to lose an average of $1,600 annually, due to reductions in Medicaid, SNAP, and other aid.

Businesses also benefit from the bill's provision to immediately deduct 100% of equipment and research costs.

Compare private student loans now

TuitionHero simplifies your student loan decision, with multiple top loans side-by-side.

[@portabletext/react] Unknown block type "component", specify a component for it in the `components.types` prop

[@portabletext/react] Unknown block type "component", specify a component for it in the `components.types` prop

Compare Rates

What’s the cost, and who pays?

According to the latest projections from non-partisan sources, the bill will:

• Increase the national deficit by $2.8 trillion over the next 10 years.
• Increase interest rate on 10-year government bonds by 14 basis points.

However, the bill will also push the debt ceiling up by $5 trillion, avoiding near-term default.

While Republicans argue these cuts are fiscally responsible, watchdog groups like the Committee for a Responsible Federal Budget have criticized the bill’s accounting as a “gimmick that would make Enron executives blush.”

Democrats have blasted the bill for balancing tax breaks for the wealthy on the backs of working families.

What should borrowers and low-income families do now?

With sweeping changes now in effect or coming soon, here’s what to do:

Student borrowers:

• If you’re on the SAVE plan, research alternative IDR plans.
• Expect additional changes to repayment plans starting in 2026.
• Explore refinancing options cautiously if you’re on an IDR plan.

Medicaid and SNAP recipients:

• Confirm your current eligibility and prepare for work reporting requirements.
• Track communications from your state agency—rules may vary by state.
• Expect to pay copays if you use Medicaid.

Families and older adults:

• Check if you're eligible for the new tax deductions or child tax credit bump.
• Use a tax calculator to plan your 2025 filing.

Why trust TuitionHero

At TuitionHero, we help you find the best private student loans by comparing top lenders and breaking down eligibility, interest rates, and repayment options. Whether you need additional funding beyond federal aid or a loan without a cosigner, we simplify the process. We also provide expert insights on refinancing, FAFSA assistance, scholarships, and student credit cards to support your financial success.

Frequently asked questions (FAQ)

Will the SAVE Plan still exist in 2025?

The SAVE plan, along with several other IDR plans, is actively being phased out. Consider alternatives like the new RAP plan.

Can Medicaid users avoid the work requirement?

Some exceptions exist (e.g. for caregivers, minors, and disabled individuals), but most adults will need to comply starting in 2026.

Does the bill affect current student loan forgiveness?

Yes. While PSLF remains intact, the elimination of multiple IDR plans removes several popular pathways for loan forgiveness.

Will SNAP recipients also face new requirements?

Yes. Most adults up to age 65 must now meet an 80-hour monthly work requirement. Parents of children over age 14 are also subject to these rules, starting in 2026.

Are electric vehicle tax credits still available?

Not for long. The $7,500 EV credit and $4,000 used vehicle credit will sunset on September 30, 2025, seven years earlier than previously planned.

How soon will these changes take effect?

Some tax provisions are retroactive to January 1, 2025. Medicaid and SNAP changes roll out gradually but begin as early as mid-2026. Student loan changes will start appearing in policy updates and federal guidance within the next 6–12 months.

Final thoughts

The “Big, Beautiful Bill” reshapes the landscape for borrowers and low-income families. It trades expanded aid and student loan relief for aggressive tax cuts, steep program rollbacks, and controversial immigration expansions.

Whether you benefit or lose depends largely on where you sit financially. For millions of Americans, especially students and working families, it could mean higher costs and fewer protections.

Stay alert, stay organized, and stay ahead—because the rules are changing fast.

Source

• H.R. 1, One Big Beautiful Bill Act (Dynamic Estimate) | Congressional Budget Office
• One Big Beautiful Bill Act Tax Policies: Details and Analysis
• Big Bill Means Big Changes For Student Loan Borrowers: What You Need to Know
• Congress Passes One Big Beautiful Bill Act Amid Major Medicaid Overhaul - American Academy of Audiology
• What's in Trump's big tax and spending bill that passed Congress and will soon become law
• What's in the tax and spending bill that Trump has signed into law