The program uses the federal tax code to provide good students that students can use to attend private secular or religious schools as well as for eligible education costs.
“Parents should decide where their children go to school. This bill helps them do so, “said senator Bill Cassidy, R-La., In a statement after the Chamber approved the Senate changes.
The Senate has changed the proposal of the home chamber, now forcing states to opt for the program, thus preventing it from becoming a truly national program. Blue states where good supports may not participate, and even in more conservative states, support is mixed – voters have recently rejected the voting measures for good schools in Kentucky and Nebraska.
This can be, in part, due to the concerns that good programs can undermine local public public schools, because when students leave a public school system, they take funding with them.
“It is not only a policy failure – it is a moral shame,” said Becky Pringle, president of the National Education Association, the largest teachers’ union in the country, in a statement. “Trump and the Congress Republicans have undermined our public schools and all the students.”
The new federal program will reward people who donate charges to what is known as stock granting organizations (SGO). Their reward: a dollar tax credit for a dollar.
The SGO would then distribute the money given in the form of scholarships that students can use on a range of expenses, including tuition fees, books and certain home teaching costs.
Unlike some of the first, the smallest programs in the country, this federal version will not be limited to low -income families. Instead, it will be available for households which earn 300% or below the median gross income of a given area. Thus, in a region of the country where median gross income is $ 75,000, any child in a household earning less than $ 225,000 could be eligible.
The cost of a program like this is difficult to measure, in particular with the opt-in warning leaving the states to decide if they will participate. However, the non -partisan joint committee on taxation estimates that the vouchers may cost the federal government nearly $ 26 billion in tax revenue lost during the next decade.
Medicaid changes and K-12 schools
More than 37 million children are registered in Medicaid or the Children’s Health Insurance Program (CHIP), a federal program that provides affordable health insurance to pregnant mothers and children who live just above the Medicaid poverty line.
The “One Big Beautiful Bill” presents strict eligibility conditions for Medicaid, including a more frequent admissibility verification and a very first national work requirement, although parents of children aged 13 and under are exempt.
It also reduces federal health expenses by approximately 1 dollars over a decade, according to the Office of the Budget of the Non -Sample Congress (CBO).
As NPR previously pointed out, state experiences with work requirements have been plagued by administrative problems, such as losing coverage of eligible registrants on paperwork and budgetary surveys.
How will all this have an impact on students from kindergarten to 12th year?
“When there are more administrative formalities, we know that this is more difficult for families,” Joan Alker, Center for Children and Families of Georgetown, told NPR.
The CBO estimates that nearly 12 million people will lose their health coverage following changes in the final bill.
Medicaid is also the fourth source of financing for schools from kindergarten to 12th year, according to the School Superintendnts Association (AASA). Schools receive money to help provide services to low -income students registered in Medicaid or Chip as well as disabled students.
In a survey published earlier this year, AASA asked more than 1,000 managers in the School District of the 50 States and the District of Columbia how they used Medicaid funds. The vast majority of districts (86%) have said that Medicaid funds support wages of school health personnel such as nurses, psychologists, occupational therapists and physiotherapists and speech therapists. More than half have said that Medicaid helps finance mental and behavioral health services in school districts.
When they were asked how their districts would face the loss of funds, 80% of respondents predicted the layoffs of school health personnel and more than half provided for a reduction in services and resources for students.
Food assistance cuts would also affect eligibility for free school meals
The additional nutrition assistance program (SNAP), which, according to the American department of agriculture, helps to pay the grocery store for more than 15 million children in the United States, will also undergo significant changes in the coming years.
The “One Big Beautiful Bill” narrows the number of people who are exempt from Snap work requirements. Katie Bergh, analyst of main policies for food aid at the Center on Budget and Policy Priories, told NPR before the bill was adopted: “Research has shown several times that (work requirements do not increase) the employment of people. This does not increase their earnings. It just cuts people from Snap and lets them be hungry. ”
When children lose access to benefits, they also lose their automatic registrations for free meals at school.
The new law will reduce around $ 186 billion in 10 years, according to the CBO. Bergh’s organization estimates: “About 1 million children would see food aid for their families reduced or dismissed.”
For the first time in the history of Snap, the federal government also moves part of the cost of states.
The question of whether this change of funding, from the federal government to the States, is a good idea is “questionable”, Kevin Corinth, who studies the poverty and security programs at the American Enterprise Institute (AEI), told NPR before the bill. Although he highlighted an upward potential: it could force states to have “more skin in the game”.
According to CBO, a potential drawback is that some states “would completely modify the advantages or eligibility or leave (SNAP) due to the increase in costs”.
An increase in children’s tax credit
The “One Big Beautiful Bill” is delivered with a modest increase in tax credit for parents. The children’s tax credit, now capped at $ 2,000 per child, will increase to $ 2,200. However, this requires at least one parent and all eligible children to provide valid social security numbers.
And, as for the current children’s tax credit, this expansion would only be available for families earning enough income to be eligible and therefore unavailable for low and moderate income families.
That knowing about major changes to federal student loans
The law will support the reset button for the Federal Student Loan Policy.
For graduate students, the new loan limits will make it more difficult for lower and medium income borrowers to attend more expensive higher education programs. The former Grad Plus program, which has enabled students to borrow the cost of their higher education program, will be closed on July 1, 2026. After that, the loan of students from graduates will be capped at $ 20,500 per year with a higher education loan limit of $ 100,000, a great drop in the previous ceiling of $ 138,500.
Borrowers working towards a professional study diploma (including medical or law faculty) will have their borrowing capped at $ 50,000 per year, and their life ceiling increased from $ 138,500 to $ 200,000.
Parents and caregivers who use more loans to help students pay for college will also see new loan limits. They will be capped at $ 20,000 per year and, in general, at $ 65,000 per child.
The law also sets a new life borrowing limit, for the first cycle And graduate loans, at $ 257,500 per person.
The Republicans also agreed to make major changes to the reimbursement plans, assuming most of them, including the generous backup of the Biden era.
After July 1, 2026, the new borrowers will only have two reimbursement options: 1.) A new plan based on income which obliges borrowers to pay at least $ 10 per month and to cancel out loans after 30 years of reimbursement, or 2) a new standard reimbursement plan with fixed monthly payments over 10-25 years – the higher the debt, the longer the reimbursement window.
Older and current borrowers will have some additional choices, at least for the moment, which will undoubtedly arouse confusion among borrowers and loan service companies which must give meaning to all these changes. You can find a more detailed explanation of these here.
Changes to PELL grants for low -income students
The bill expands Pell subsidies, which help low -income students to pay for the university, to include employment training programs, which is a victory for community colleges which offer a variety of certificate programs. It also modifies the eligibility for all the beneficiaries of Pell: from July 2026, students who have a full scholarship will no longer be eligible to receive Pell subsidies. The bill also entirely finances the existing deficit of the Pell subsidy.
A test of liability gains for colleges
To encourage colleges to offer a good return on investment, the bill connects access to federal student schools to the quantity of graduates of their graduates.
If a undergraduate program fails to test the profits – which means that their students earn less than someone with a secondary school diploma – this could lose access to federal loans. An analysis shows that this would have the most impact on the associated study programs of two years, although federal data show that community students depend less on federal student loans.
The measure follows in the footsteps of a similar regulation known as the paid employment rule which was developed by the Obama administration and reissued under Biden.
The final version of this new empowerment policy is not going as far as the version of the Chamber – this project included a risk sharing plan where colleges would pay a penalty according to the federal loan debt that their students do not reimburse.
A higher tax on college allocations
Colleges with endowments will now be taxed at a higher rate.
The bill increases the tax rate from 1.4% to 8%, according to the endowment of the college.
The endowment of Harvard University, which is currently fighting on several legal battles against the Trump administration, has more than $ 52 billion. Based on the formula of the new law, which places Harvard in the highest endowment tax tranche, for institutions with an endowment of more than $ 2 million per domestic student.
There is a sculpture for small private colleges: institutions of less than 3,000 students are exempt from the tax. The previous exemption was 500 students.
