Updated July 1, 2025 at 3:30 AM AKDT
The fate of the sweeping GOP tax and spending bill hangs in the balance as senators continue to work on amendments and closed-door negotiations Tuesday morning following an all-night session.
Senators slowly worked their way through dozens of amendments as GOP holdouts met with Senate Majority Leader John Thune, R-S.D., both on the floor of the Senate and in his private office in the Capitol. The talks—and amendments—show few signs of ending.
Eyes are on Sens. Lisa Murkowski, R-Alaska, and Susan Collins, R-Maine, as two potential hold outs on the bill. Sens. Thom Tillis, R-N.C., and Rand Paul, R-Ky., already oppose the bill, meaning Republicans can only afford to lose Collins or Murkwoski if they hope to pass the bill—and even then Vice President JD Vance would be needed to break a tie.
Republicans remain seriously divided over changes to Medicaid, the joint state and federal health program that provides insurance for low-income, elderly and disabled Americans. Tillis opposes the bill over cuts to the program that could lead to nearly 12 million people losing health coverage, according to estimates from the nonpartisan Congressional Budget Office.
Senate leaders have tried to win votes from Murkowski in particular by introducing waivers to exempt Alaska and other high poverty states from some changes in the bill but several of those exemptions failed to meet the strict rules for what can be considered with a simple majority vote in the Senate.
The vote series began at 9 a.m. on Monday and slowly advanced throughout the day and night. In the process only a handful of meaningful changes were approved, including a vote to strip from the bill a controversial provision that would have barred states from regulating artificial intelligence for a decade.
While some GOP senators also have concerns about the size of the bill or the impact on the deficit, many seem prepared to vote for the legislation. If it does pass, the bill will face another major test in the House, where Republicans have a razor-thin majority and many members have already raised objections to the Senate bill.
This is a developing story, some elements of the bill were negotiated up until the last minute. What follows is a partial list and will be updated.
Some of the biggest changes
Tax incentives
Congressional Republicans have included many of the president's tax-related campaign promises in the bill. The Senate's text includes temporary changes that would allow Americans to deduct up to $25,000 for tip wages and $12,500 for overtime pay through 2028. The Senate version also says that overtime and tip deductions will be reduced for Americans with incomes higher than $150,000. Those limits were not included in the House version.
The Senate bill also increases the child tax credit from $2,000 to $2,200 per child and adjusts the amount for inflation after 2025. It's slightly different than the House plan to temporarily increase the credit to $2,500 before cutting it back to the current level and adjusting for inflation.
In addition, the Senate text would permanently expand the standard deduction, marking a key difference from the House bill, which temporarily expands it through 2028. Senators also boosted a tax deduction for people over 65 to $6,000 through 2028, compared to $4,000 in the House bill. Both chambers included a phase out for people earning over $75,000.
Increasing the debt ceiling
The Senate is proposing raising the nation's debt limit by $5 trillion, a sizable increase compared to the House bill, which agreed to $4 trillion.
Lifting the debt limit doesn't authorize new spending. Instead, it allows the government to pay for programs that Congress has already authorized. If the cap isn't lifted and the government can't meet its obligations, then it will be at risk of default — a scenario that economists say would be catastrophic not just for the U.S., but the global financial system as a whole. The CBO estimates that without action from Congress, the U.S. will run out of money to pay its bills at some point between mid-August and the end of September.
Earlier this month, 38 members signed onto a letter addressed to Senate Majority Leader John Thune, R-S.D., criticizing the size of the increase.
Changes to SNAP
Both the Senate and House outlined reforms for the Supplemental Nutrition Assistance Program, known as SNAP, which provides aid for food to more than 40 million low-income Americans.
The Senate bill includes expanded work requirements that "able bodied adults" continue to work up to age 64. There are exemptions for parents with children under 14 and limits on the ways states can offer waivers for those requirements.
The bill would also force states to take on a greater share of the cost of providing food assistance. The amount a state owes would be based on a formula set by the percentage of erroneous payments reported each year. Those changes would go into effect in 2028.
State and Local Tax Deduction
One of the thorniest issues during negotiations has been the state and local tax deduction, also known as SALT. The deduction is particularly important to a small number of GOP lawmakers in the House from blue states with high taxes, such as California and New York. Trump's 2017 tax cuts capped the SALT deduction at $10,000. The Senate plan would temporarily lift the cap to $40,000 for married couples with incomes up to $500,000. But that provision would expire after 2028 — an effort to buoy the blue-state Republicans through the 2026 midterm and 2028 election cycles, while limiting the long-term impact of the cuts on federal tax revenue.
"We have about a dozen members that are voting on this bill exclusively based on what happens with SALT. There's not a single senator on the Republican side that has that same issue," House Majority Leader Steve Scalise R-La., acknowledged to reporters on Tuesday adding an agreement on SALT "has to get resolved if you're going to have a bill to pass."
Medicaid
The Senate released an updated version of the legislation that includes several proposed changes to Medicaid, the popular, joint federal/state health care program for low-income, elderly and disabled Americans. It's remained one of the most divisive issues throughout both House and Senate negotiations.
The Senate plan would require able bodied adults to work 80 hours per month until age 65 to qualify for benefits. There are carveouts for parents of children under 14 and those with disabilities.
The plan would also cap and gradually reduce the tax states can impose on Medicaid providers. The phase out would begin in 2028, ultimately ending in a 3.5 percent cap on that tax. Several GOP senators have raised concerns that the tax is a critical funding stream for rural hospitals in particular — which could close if that income stream dries up.
In an effort to alleviate some of those concerns, Senate GOP leaders included a new $25 billion fund to support rural hospitals. That program would also begin in 2028 and funds would be spread out over five years.
What's stayed mostly the same
Extending the Trump tax cuts
The Senate bill calls for $4 trillion in tax cuts, which is slightly higher than the $3.8 trillion proposed in the House. That move would extend Trump's 2017 tax cuts, which are set to expire at the end of the year, meaning that without an extension, most households would see their taxes increase.
Billions for border security
Both the Senate and the House bills allocate $46.5 billion toward completing Trump's border wall. It also puts $5 billion for Customs and Border Protection facilities and $10 billion to be used for border security more broadly. The Senate bill sets aside less funding to hire and retain more agents and officers, proposing $4.1 billion compared to the $6 billion allocated in the House. The legislation also invests in upgraded technology for screenings and surveillance of U.S. borders.
New immigration fees
Much like the House-passed bill, the Senate legislation includes a handful of new or increased fees for immigration services. The bill would create a $550 charge for work authorization applications with renewal every six months.
However, the Senate parliamentarian determined that a $1,000 fee for asylum applications did not meet the rules necessary to qualify for a simple majority vote.
A student loan overhaul
Like the House-passed bill, the Senate plan would scrap several existing repayment options, including the Biden-era SAVE program that based payments on income and household size. It replaces them with a new, standard repayment plan and an income-based plan Republicans call their "Repayment Assistance Plan." The bill would also cap the amount that parents and graduate students can take out in federal loans each year.
One difference between the two bills concerns the Pell Grant program for low-income students. The House proposed increasing the credit hours required for full-time and part-time students in order to receive Pell Grants, but the Senate has left current enrollment rules intact. The Senate bill does bar students from qualifying for a Pell Grant if they've received a full scholarship through other sources of aid.
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