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The Daily Money

ALL THE MONEY NEWS YOU NEED TO KNOW

Wed May 21 2025

Daniel de Visé | Personal Finance Reporter

Good morning! It's Daniel de Visé with your Daily Money.

Today, it's all about taxes.

Yesterday, the U.S. Senate unexpectedly passed a bill to create a new tax deduction on tips worth up to $25,000.

The bill, introduced by Sen. Ted Cruz, R-Texas, passed with unanimous consent – a rare occurrence for substantive legislation. Here's what it would take for the measure to become law.

Trump tax bill: How big? How beautiful?

Meanwhile, President Trump's "big, beautiful" tax bill is making its way through Congress, but how big and beautiful is it for you?

In a big win for Trump, the bill won approval from a key congressional committee on May 18 to advance toward possible passage in the House of Representatives later this week. The legislation is still far from a done deal. Here are some of its provisions.

Does Trump's tax bill take aim at blue states?

Back to the "big, beautiful bill": One of its key sticking points hits Americans directly where they live, especially if they live in high-tax states.

The state and local tax deduction, often abbreviated as SALT, was a political flashpoint in the passage of the 2017 Tax Cuts and Jobs Act and is shaping up to be so again in 2025.

SALT refers to the ability to deduct taxes paid to state and local governments from an individual's federal tax bill. The 2017 legislation capped that amount at $10,000, an amount that many taxpayers in higher-tax states easily exceed. Democrats say that's no coincidence.

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About The Daily Money

Each weekday, The Daily Money delivers the best consumer and financial news from USA TODAY, breaking down complex events, providing the TLDR version, and explaining how everything from Fed rate changes to bankruptcies impacts you.

Daniel de Visé covers personal finance for USA Today.