How the "big, beautiful bill" will affect San Diegans' taxes
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The average San Diego County resident will see a federal tax cut of about $3,564 in 2026 thanks to the "big, beautiful bill," according to an analysis from the Tax Foundation, a nonpartisan research group that mostly supports lower taxes.
Why it matters: That's money people can spend on other things like rent, groceries and other bills — which could be essential next year as inflation outpaces wages and tariffs threaten to push costs up further.
How it works: The spending bill Congress passed in July not only made President Trump's first-term tax cuts permanent, it added on new breaks: deductions for tips and overtime income, a cut for seniors and an expanded child-care tax cut.
- These are temporary provisions.
- The report compares the tax rate in 2026 with what it would've been had the bill not passed and the 2017 tax cuts expired.
Zoom out: There are broad geographic differences in tax benefits from the spending bill due to variations in state and local taxes, plus areas where more high-earners live, Axios' Emily Peck and Jason Lalljee report.
- In California, the average tax cut per filer will be $4,141, the data shows. The Bay Area will see the biggest cuts (around $12,000), while Imperial County will see one of the smallest ($1,810).
- Nationally, it's $3,752.
Between the lines: Business owners will get some of the biggest cuts — thanks, in part, to tax breaks being made permanent for research and development expenses and other provisions.
- Those in high-tax coastal regions will also get big breaks, from the increased cap on state and local tax deductions (known as SALT — also temporary).
Reality check: The bill also made some steep cuts to social spending on food benefits and Medicaid, but those mostly don't kick in until 2027 and 2028.
- For many lower-income Americans, those cuts will outweigh any benefits of these tax breaks.