Residents across the United States are bracing for a seismic shift in their federal tax bills in 2026, thanks to President Donald Trump’s recently enacted “Big Beautiful Bill.” Signed into law on July 4, 2025, this sweeping legislation marks the most significant overhaul of federal tax policy since the 2017 Tax Cuts and Jobs Act, and, according to a detailed analysis by the nonpartisan Tax Foundation, the effects will be felt in wallets from Miami-Dade to Middle Tennessee and beyond.
For many, the headline is clear: a sizable tax cut is on the way. The Tax Foundation’s August 20, 2025, analysis projects that the average South Florida resident will see a federal tax cut of about $5,100 in 2026, with Miami-Dade residents expected to receive an average break of $5,872 and those in Broward County looking at $4,441. Across Florida, the average tax cut will hover around $5,000, but the impact isn’t uniform. Collier County, a haven for high earners, will see some of the state’s largest average cuts at $14,315, while Gadsden County taxpayers will receive just $1,714 on average. These disparities stem from differences in local incomes and the concentration of high-earning households, as Axios reports.
Middle Tennessee is also poised for significant relief. The Tax Foundation notes that Davidson County residents can expect an average tax cut of $5,790 in 2026—nearly 43% higher than the national average of $3,752. Williamson County, the state’s wealthiest, will see the highest average cut in Tennessee at $9,951 per taxpayer. Sumner and Wilson counties will receive average reductions of $4,177 and $4,143, respectively. Meanwhile, rural Clay County is projected to get the lowest average cut in the region at $2,069. These figures underscore the broad geographic differences in how the bill’s benefits play out, with wealthier areas and those with more business owners generally faring best.
So, what’s driving these numbers? The “Big Beautiful Bill” accomplishes two major feats: it makes the 2017 tax cuts permanent and introduces new, though temporary, tax breaks. These include deductions for tips and overtime pay, a cut for seniors, and an expanded child-care tax credit. For business owners, the news is especially good. The bill makes permanent certain tax breaks for research and development expenses and other business provisions, meaning entrepreneurs and corporations will see some of the biggest savings. According to the Tax Foundation’s methodology, the financial impact of these business-related changes is assumed to be shared between capital and labor income, gradually shifting from mostly benefiting capital (like shareholders) to an even split with workers over five years.
But there’s a catch—and it’s a big one. While taxpayers may welcome the extra money, the bill also ushers in steep cuts to social spending programs, particularly food assistance (SNAP) and Medicaid. These reductions are set to take effect mostly in 2027 and 2028, after the tax cuts have landed. According to USA TODAY, these changes could result in as many as 7.6 million people losing health insurance over the next decade. For lower-income Americans, the loss of these benefits may ultimately outweigh the gains from their tax cuts, a sobering reality that tempers the bill’s celebratory tone.
Nationally, the average tax cut for those filing in 2026 is projected to be $3,752, according to the Tax Foundation. However, that number is expected to drop to $2,505 by 2030 as temporary provisions—like deductions for tips and overtime—expire. By 2035, the average cut is forecast to rise again to $3,301, reflecting the effect of inflation on the permanent tax provisions. Of course, these are just averages; the actual impact varies widely depending on where you live and how much you earn.
Some of the largest average tax cuts in the nation are concentrated in mountain resort counties. Teton County, Wyoming, for example, is projected to see the highest average tax cut nationwide at $37,373 per taxpayer in 2026. Pitkin County, Colorado ($21,363), and Summit County, Utah ($14,537) follow closely behind, a reflection of the high incomes and business ownership prevalent in those areas. In contrast, rural counties like Loup County, Nebraska, will see much smaller average cuts—just $824 per taxpayer in 2026, the Tax Foundation reports.
To arrive at these estimates, the Tax Foundation used its General Equilibrium Model and 2022 IRS data, matching national revenue estimates to counties based on specific tax characteristics and averaging the results by the number of filers in each area. The analysis focused on individual and business tax provisions, excluding changes to the estate tax. However, the foundation cautions that the accuracy of its analysis is limited for some of the newer and more targeted provisions, such as the tipped income deduction, due to gaps in county-level IRS data.
Beyond the headline numbers, the real-world impact of the tax cuts will depend on broader economic forces. The Tax Foundation’s estimates do not account for changes in GDP or other macroeconomic effects, and the distribution of labor and capital income across states can influence how the benefits are felt. For job impacts at the state level, national projections were used along with state-specific income distributions, though these are, by necessity, approximations.
For everyday Americans, the extra money could make a real difference, especially as inflation continues to outpace wage growth and tariffs threaten to push prices higher. As Axios notes, "That's money people can spend on rent, groceries or bills, which may be needed next year as inflation outpaces wages, and tariffs threaten to increase costs even further." Yet, for those reliant on social programs, the looming cuts to food benefits and Medicaid cast a long shadow. The Tax Foundation’s analysis and reporting from USA TODAY both make clear that, for many lower-income Americans, these cuts could outweigh the benefits of the tax breaks.
As the country looks ahead to 2026, the “Big Beautiful Bill” stands to reshape the financial landscape for millions, offering relief for some and tough choices for others. The true legacy of this legislation will likely depend not just on the size of the tax cuts, but on how its winners and losers adapt in the years to come.