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Starting in 2026, millions of Americans could see a steep increase in the cost for marketplace health insurance unless Congress extends a pandemic-era tax break.
Without action from Congress, the premium tax credit — which makes Affordable Care Act coverage cheaper — could get smaller after 2025.
Some enrollees could face a “subsidy cliff,” which eliminates the credit entirely once income exceeds certain thresholds.

Tom Werner | Digitalvision | Getty Images

Starting in 2026, millions of Americans could see a steep increase in the cost of marketplace health insurance — unless Congress extends a pandemic-era boost that made Affordable Care Act plan premiums more affordable.
This could affect millions of Americans, including students, self-employed or contract workers and younger retirees, who buy marketplace insurance and claim the so-called premium tax credit, which makes coverage cheaper.

The enhanced benefit is set to expire at the end of the year. If it does, some enrollees could face a “subsidy cliff,” which eliminates the premium tax credit entirely, once income exceeds certain thresholds, financial experts say. 
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If you pass the threshold by even $1 and lose the credit, “costs could go up by hundreds of dollars a month,” said certified financial planner Cathy Curtis, CEO of Curtis Financial Planning in Oakland, California.
But precise income projections can be tricky, said Curtis, who is also a member of CNBC’s Financial Advisor Council.

The average ACA enrollee saved roughly $700, about 44%, from the enhanced premium tax credit in 2024, according to November research from the Center on Budget and Policy Priorities, a nonpartisan policy organization.

Enacted in early July, President Donald Trump’s “big beautiful bill” made permanent the Republicans’ 2017 tax cuts. But it did not extend the enhanced ACA subsidies passed via the American Rescue Plan in 2021. It’s unclear whether the GOP-controlled Congress will consider such a measure before year-end. 
Here is a breakdown of what to know about the premium tax credit and how to avoid the “subsidy cliff” if enhancements expire after 2025. 

How the premium tax credit works

If you’re eligible for the premium tax credit, you can use it to reduce monthly ACA premiums upfront or claim the credit on your tax return.
The tax break was originally for enrollees earning between 100% and 400% of the federal poverty level. But the American Rescue Plan expanded eligibility above 400%.
For 2025, that threshold was $103,280 for a family of three, according to The Peterson Center on Healthcare and KFF, which are both health-care policy organizations.

For 2025, more than 22 million people — about 92% of enrollees — receive premium tax credits, according to KFF.
That group could be “significantly affected in 2026” if Congress doesn’t extend the larger benefit, said Tommy Lucas, a CFP at Moisand Fitzgerald Tamayo in Orlando, Florida.

How to avoid the ‘subsidy cliff’

It’s important to run tax projections for 2025 and 2026 if premium tax credit changes may affect you, experts said.
If you’re receiving the tax break for 2025 with earnings over 400% of the federal poverty level, you could explore ways to reduce 2026 income, Lucas said.
For example, you may consider accelerating 2026 income into 2025, tax-loss harvesting or claiming a deduction for health savings account contributions, he said.
If the bigger premium tax credit expires for 2026, “we’re going to have to monitor [income] on a pretty regular basis, at least quarterly, if not monthly” to avoid the cliff, Lucas said. More

Some investors follow company insiders on the notion that they would know better than anyone when it’s the right time to buy or sell shares.
CNBC rounded up some of the biggest sales over the last week.

The sign on the side of a Costco is seen in Hawthorne, California, on April 4, 2025.
Jay L Clendenin | Getty Images

Executives or officers of major companies filed some notable stock sales with the Securities and Exchange Commission last week.
Some investors follow company insiders, especially hefty moves or a cluster of moves, on the notion that they would know better than anyone when it’s the right time to buy or sell shares in their company.

The data, which is from VerityData, is confirmed against the original SEC filings. These exclude where the filing explicitly says the sale was conducted pursuant to preplanned 10b5-1 trading plan, meaning the focus is instead on discretionary activity.
Here’s some of the biggest sales from the last week:

Heico

Heico executive chairman Laurans Mendelson sold 56,300 shares at an average price of $319.45. That makes for a total of nearly $17.99 million.
Shares in the jet engine and airplane component maker were up 37% over the past three months. Heico hit an all-time high earlier this month.

AeroVironment

AeroVironment CEO Wahid Nawabi sold 17,300 shares at an average price of $263.05 for a total of $4.55 million.

Shares of the drone maker have soared more than 90% over the past three months.

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AVAV, 3 months

Costco

Costco officer Yoram Rubanenko sold 4,000 shares at an average price of $974.96, amounting to $3.9 million. The sale reduced Rubanenko’s holdings of COST by about 41%.
Shares have about flat over the past three months.

Morgan Stanley

Morgan Stanley CFO Sharon Yeshaya sold 25,583 shares at an average price of $138.81, leading to a total of $3.58 million. The sale reduced Yeshaya’s holdings by nearly 17%.
The sale coincided with sales from five other company insiders, which totaled $20 million.
Shares were up 33% over the past three months. The stock hit an all-time high earlier this month.

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Morgan Stanley, 1 month

Johnson & Johnson

John Reed, Johnson & Johnson’s executive vice president, sold 19,100 shares of the stock at an average price of $163.55, totaling $3.13 million. The sale reduced Reed’s holdings by about 64%.
Shares were up more than 4% over the past three months.

Paychex

Paychex CEO John Gibson sold 12,400 shares at an average price of $141.92. All together, that totals $1.76 million.
Company insiders, also including the finance chief, have dumped $16.6 million in shares over the past 30 days.
Shares of the HR firm have risend nearly 2% over the past three months.

Dream Finder Homes

William Radford Lovett II, an investor at Dream Finder Homes, sold 48,500 in shares of the homebuilder at an average price of $29.96. That totaled $1.31 million.
Shares of the homebuilder have climbed about 24% over the past three months.

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The earnings season is on, and investors are paying attention to how the leading companies are faring. However, tariffs and other challenges remain on the minds of investors.
While top Wall Street analysts also watch the quarterly results closely, they generally have a broader focus and assess the company’s ability to navigate short-term difficulties and deliver attractive returns over the long term.

Here are three stocks favored by the Street’s top pros, according to TipRanks, a platform that ranks analysts based on their past performance.

Uber Technologies

First on this week’s list is ride-sharing and delivery platform Uber Technologies (UBER). The company is scheduled to announce its second-quarter results on Aug. 6.
In a preview note on Uber’s Q2 earnings, Evercore analyst Mark Mahaney stated that he expects the company to report a 17% year-over-year growth in gross bookings to $46.8 billion, slightly above the Street’s estimate and within the company’s guidance.
The analyst expects revenue growth of 18%, modestly above the Street’s expectations, and EBITDA (earnings before interest, tax, depreciation, and amortization) of $2.09 billion, in line with the consensus estimate. Mahaney’s estimates are based on favorable industry checks for consumer demand trends, third-party data checks, and Evercore’s non-deal roadshows (NDR) with UBER management. The analyst’s expectations are also backed by Evercore’s 8th Annual U.S. Ridesharing Survey and insights from its NDR with DoorDash management.
Despite the stellar year-to-date rally, Mahaney stated that UBER remains a top pick for Evercore. He attributed the stock’s rise to multiple factors, including better-than-expected growth in Mobility and Delivery bookings over the past two quarters and positive key user metrics and the impressive rollout of Waymo in Austin on the Uber network.

“Key to our Long Thesis – we believe there will be ‘more Austins’ – more successful robotaxi partner rollouts for Uber, and not just with Waymo, over the next 12-18 months,” said Mahaney and reaffirmed a buy rating on UBER stock with a price forecast of $115. Meanwhile, TipRanks’ AI analyst has an “outperform” rating on UBER stock with a price forecast of $108.
Mahaney ranks No. 219 among more than 9,800 analysts tracked by TipRanks. His ratings have been profitable 60% of the time, delivering an average return of 15.9%. See Uber Technologies Statistics on TipRanks.

Alphabet

We move to Alphabet (GOOGL), the parent company of search engine giant Google. In a Q2 earnings preview of the companies in the internet space, JPMorgan analyst Doug Anmuth reaffirmed a buy rating on GOOGL stock and increased the price forecast to $200 from $195. In comparison, TipRanks’ AI analyst has a price target of $199 on GOOGL stock with an “outperform” rating. Anmuth explained that his higher estimates mainly reflect better channel checks and third-party data as well as more favorable forex changes.
Anmuth added that his revised price target is based on a multiple of about 20-times his 2026 GAAP earnings per share (EPS) estimate of $9.89. The analyst believes that Alphabet deserves to trade at a premium to the S&P 500, given that it is one of the few companies in this index with a double-digit percent revenue and EPS growth on a very large base. He also highlighted the company’s more than 30% GAAP operating income margin.
“We believe Alphabet’s fundamentals are solid and the company will remain both a driver of and primary beneficiary of an increasingly digital economy & advances in Generative AI,” said Anmuth.
He highlighted Alphabet’s continued focus on innovation. Anmuth sees a healthy runway across Search and YouTube ads, with artificial intelligence (AI) fueling higher return on investment (ROI) and a shift in TV dollars to online channels. Furthermore, he said that Alphabet’s non-ad businesses, like Cloud and YouTube subscription services, still have substantial scope to grow. Anmuth also said that the companies within Alphabet’s Other Bets division, including Waymo and Verily, provide potential upside.
Overall, Anmuth is bullish about Alphabet’s ability to innovate around generative AI, control costs and deliver impressive revenue growth.
Anmuth ranks No. 56 among more than 9,800 analysts tracked by TipRanks. His ratings have been successful 65% of the time, delivering an average return of 21.6%. See Alphabet Stock News and Insights on TipRanks.

Meta Platforms

Anmuth is also bullish on social media giant Meta Platforms (META) and raised the price target for the stock to $795 from $735 while maintaining a buy rating ahead of the company’s Q2 results. In comparison, TipRanks’ AI analyst has an “outperform” rating on META stock with a price target of $798.
The analyst explained that the upgraded price target is based on about 27-times his 2026 GAAP EPS estimate of $29.53. Anmuth believes that META stock’s premium valuation to the S&P 500 is justified, as he has greater confidence in the company’s robust top-line growth and ongoing cost efficiencies.
“We believe Meta’s virtual ownership of the social graph, strong competitive moat, and focus on the user experience position it to become an enduring blue-chip company built for the long term,” said Anmuth.
The analyst noted Meta Platforms’ strength in terms of scale, growth, and profitability, with its extensive reach and engagement continuing to drive network effects. Anmuth also noted the company’s targeting abilities that offer huge value to advertisers.
Anmuth stated that Meta will invest in the massive growth opportunities offered by the two big tech waves – AI and Metaverse, while also focusing on cost discipline. Despite significant infrastructure investments, the analyst expects Meta Platforms to deliver strong revenue and EPS growth in 2026. He noted Meta’s solid track record in delivering returns on higher spending. See Meta Platforms Insider Trading Activity on TipRanks. More

President Donald Trump’s “big beautiful bill” includes several tax changes that are effective for 2025.
Provisions include permanent extensions of Trump’s 2017 tax cuts, along with boosts for the standard deduction and child tax credit.
There are also new temporary deductions for older Americans, tips, overtime income and auto loan interest.

Speaker of the House Mike Johnson (R-LA) (C) signs the One Big Beautiful Bill Act during an enrollment ceremony with fellow Republicans in the Rayburn Room at the U.S. Capitol on July 03, 2025 in Washington, DC.
Chip Somodevilla | Getty Images News | Getty Images

It’s been about two weeks since President Donald Trump’s “big beautiful bill” became law, and financial advisors and tax professionals are still digesting what the sweeping legislation means for clients.
Meanwhile, several changes are effective for 2025, which will impact tax returns filed in 2026.

While the Trump administration has been promoting “working family tax cuts,” the legislation’s impact depends on your unique situation — and some updates are complex, experts say. 
“There are just so many moving pieces,” said certified financial planner Jim Guarino, managing director at Baker Newman Noyes in Woburn, Massachusetts. He is also a certified public accountant.
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Currently, many advisors are running projections — often for multiple years — to see how the new provisions could impact taxes.
Without income planning, you could reduce, or even eliminate, various tax benefits for which you are otherwise eligible, experts say.

When it comes to tax strategy, “you never want to do anything in a silo,” Guarino said. 
Here are some of the key changes from Trump’s legislation to know for 2025, and how the updates could affect your taxes.

Trump’s 2017 tax cut extensions

The Republicans’ marquee law made permanent Trump’s 2017 tax cuts — including lower tax brackets and higher standard deductions, among other provisions — which broadly reduced taxes for Americans.
Without the extension, most filers could have seen higher taxes in 2026, according to a 2024 report from the Tax Foundation. However, the new law enhances Trump’s 2017 cuts, with a few tax breaks that start in 2025:

The standard deduction increases from $15,000 to $15,750 (single filers) and $30,000 to $31,500 (married filing jointly).
There is also a bump for the child tax credit, with the maximum benefit going from $2,000 to $2,200 per child.

If you itemize tax breaks, there is also a temporary higher cap on the state and local tax deduction, or SALT. For 2025, the SALT deduction limit is $40,000, up from $10,000.
The higher SALT benefit phases out, or reduces, for incomes between $500,000 to $600,000, which can create an artificially higher tax rate of 45.5% that some experts are calling a “SALT torpedo.”
This creates a “sweet spot” for the SALT deduction between $200,000 and $500,000 of earnings, based on other provisions in the bill, CPA John McCarthy wrote in a blog post this week.  

Trump’s new tax changes for 2025

Trump’s tax and spending bill also introduced some temporary tax breaks, which are effective for 2025. Some of these were floated during his 2024 presidential campaign.These provisions include a $6,000 “bonus” deduction for certain older Americans ages 65 and over, which phases out over $75,000 for single filers or $150,000 for married couples filing jointly. 
There are also new deductions for tip income, overtime earnings and car loan interest, with varying eligibility requirements.
This chart shows a breakdown of some of the key individual provisions that are effective for 2025 compared to previous law.

Premium tax credit ‘subsidy cliff’ returns 

During the pandemic, Congress boosted the premium tax credit through 2025, which made Marketplace health insurance more affordable.  
But Trump’s legislation didn’t extend the enhanced tax break, which could raise Affordable Care Act premiums for more than 22 million enrollees if no action is taken, according to KFF, a health policy organization.
That could impact enrollees when choosing ACA health plans this fall, according to Tommy Lucas, a CFP and enrolled agent at Moisand Fitzgerald Tamayo in Orlando, Florida.

Starting in 2026, enrollees need to prepare for the ACA subsidy cliff, where enrollees lose the premium tax credit when income exceeds the earnings thresholds by even $1, he said.   
Currently, most ACA enrollees receive at least part of the premium tax credit. However, the subsidy cliff means enrollees lose the benefit once earnings exceed 400% of the federal poverty limit. For 2025, that threshold was $103,280 for a family of three, according to The Peterson Center on Healthcare, a nonprofit for healthcare policy, and KFF. More

Thomas Fuller | SOPA Images | Lightrocket | Getty Images

Company: Global Payments Inc (GPN)
Business: Global Payments is a payments technology company delivering software and services to its customers globally. Through its Merchant Solutions segment, it provides payments technology and software solutions globally to small-and-medium sized businesses and select mid-market and enterprise customers. It offers authorization, settlement and funding services, customer support, chargeback resolution, reconciliation and dispute management services, terminal rental, sales and deployment, payment security services, consolidated billing and reporting. It offers an array of business management software solutions that streamline business operations to customers in numerous vertical markets. Through its Issuer Solutions segment, it provides financial institutions and retailers technologies to manage their card portfolios. It provides flexible commercial payments, accounts payable and electronic payment alternative solutions that support B2B payment processes for businesses and governments.
Stock Market Value: $19.98B ($81.93 per share)

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Global Payments in 2025

Activist: Elliott Investment Management

Ownership: n/a
Average Cost: n/a
Activist Commentary: Elliott is a very successful and astute activist investor. The firm’s team includes analysts from leading tech private equity firms, engineers, operating partners – former technology CEOs and COOs. When evaluating an investment, the firm also hires specialty and general management consultants, expert cost analysts and industry specialists. Elliott often watches companies for many years before investing and has an extensive stable of impressive board candidates. The firm has historically focused on strategic activism in the technology sector and has been very successful with that strategy. However, over the past several years its activism group has grown, and Elliott has been doing a lot more governance-oriented activism and creating value from a board level at a much larger breadth of companies.
What’s happening
Elliott has taken a position in Global Payments.
Behind the scenes
Global Payments is a leading provider of payment processing and software solutions, focused on serving small and medium-sized merchants and select mid-market and enterprise customers. The company operates through two segments: Merchant Solutions and Issuer Solutions. Merchant Solutions, contributing about three-fourths of total sales, provides payment solutions to enable customers to accept card, check, and digital payments, offering authorization, settlement, funding and other services. Simply put, Global Payments, as a merchant acquirer, acts as a middleman between the merchant and card network to authorize and facilitate transactions. Through its Issuer Solutions segment, Global Payments provides comprehensive commerce solutions supporting the payment ecosystem for issuers through offerings like core processing, enterprise tokenization and more. This segment was formed in 2019 following the combination of Global Payments and Total System Services (“TSYS”) in an all-stock merger of equals to create a leading payments company with a presence in both merchant acquiring and issuer services.

Peaking in 2021 at roughly $220 per share and an enterprise value to earnings before interest, taxes, depreciation and amortization (EV/EBITDA) multiple of about 25-times, the company today trades around $80 per share and at a high single-digit multiple. The company managed to tread water during the pandemic despite the global slowdown in transactions and its focus on small and medium enterprises. However, sales growth has slowed significantly since 2020, now below the core acquiring market’s high-single growth rate, implying market share loss to disruptors like Stripe, Fiserv’s Clover, Shopify and others. That is all very interesting, but not what this activist campaign is about. This is about a company that made a poorly received “bet the farm” acquisition and is now at an inflection point that will determine its future.
On April 17, Global Payments announced that it had agreed to acquire Worldpay from Fidelity National Information Services (FIS) and private equity firm GTCR. The three-way cash-and-share acquisition also involved Global Payments divesting its Issuer Solutions (previously known as TSYS) business to FIS in a deal which valued Worldpay at $24.25 billion and Issuer Solutions at $13.5 billion. Global Payments’ shares fell 17% following the announcement for many good reasons: (i) this acquisition was announced after management’s commitments at their 2024 Investor Day to pursue increased shareholder returns, divestments, and, at most, small bolt-on acquisitions, (ii) management has a poor track record of integrating (or failing to integrate) acquisitions such as TSYS and AdvancedMD, and (iii) the company paid too much for Worldpay – acquiring it at 10.5-times EBITDA versus the 6.5-times multiple Global Payments trades at. Moreover, investors have grown skeptical of deals of this sort in the payments space after two of the three largest deals made in a 2019 wave of consolidation have been unwound (Global Payments – TSYS and FIS – Worldpay).
But the good news is that failure is priced in. Management thinks the Worldpay transaction makes strategic sense for Global Payments, simplifying its business model into a pure-play commerce solutions provider, and that it will provide $600 million in annual cost synergies and $200 million in revenue synergies. The market is not believing this or has little faith that management can achieve these synergies. From where the stock trades today, if management can come anywhere close to achieving these synergies and executing on this transaction, it will be a nice return for stockholders. What this company needs right now is help in execution and enhanced credibility, and Elliott can provide both.
There are companies that could use shareholder representation on the board and companies that need it. Global Payments is much closer to the latter. A reconstituted board that holds management accountable, commits to an M&A moratorium and adds members with experience integrating large acquisitions will almost immediately restore investor confidence in the company. Thereafter, the board can start to de-lever and possibly buy back shares at the appropriate time if Global Payments’ stock is still significantly undervalued. We would also expect the board to do the most important thing boards do – oversee and evaluate senior management, but we do not think there would be any material management changes ahead of such a large acquisition like this.
Given the almost universal opposition to the Worldpay acquisition and the low investor confidence in management, we would expect that Elliott will be able to walk onto this board with any reasonable slate. In a contested situation for the 10-person unitary board using a universal proxy card, Global Payments would almost certainly face significant defeat. Elliott recently won two of four seats at Phillips 66 in a proxy fight with a much higher degree of difficulty. The fund made its reputation as an activist almost two decades ago as primarily a strategic activist in technology companies, making great returns getting companies sold or participating in the acquisition. However, Elliott has since evolved into a much broader and comprehensive activist in strategy, sector and geography. Today, the firm often does its best activism from the board level. We believe that a reconstituted board that includes an Elliott representative will restore investor confidence and increase the probability of a successful integration of Worldpay.
Ken Squire is the founder and president of 13D Monitor, an institutional research service on shareholder activism, and the founder and portfolio manager of the 13D Activist Fund, a mutual fund that invests in a portfolio of activist 13D investments. More

Many student loan borrowers could see their monthly bills more than double now that the Biden-era Saving on a Valuable Education, or SAVE, plan is defunct.
Here’s what to know about your options.

Natalia Lebedinskaia | Moment | Getty Images

As a Biden-era relief measure for federal student loan borrowers comes to an end, some people could see their bills more than double.
Earlier this month, the Trump administration announced that the so-called SAVE interest-free payment pause will expire on Aug. 1, and that enrollees’ education debts will begin to grow again if they don’t make payments large enough to cover the accruing interest.

The Biden administration had moved people who enrolled in its SAVE plan into forbearance — a period during which federal student loan borrowers are excused from making payments — while the legal challenges against its program played out. The SAVE, or Saving on a Valuable Education, plan, is now essentially defunct.

While borrowers can remain in the SAVE forbearance for the time being, they’ll face interest charges again starting next month if they do.
But those who look to move into another repayment plan will likely face a much larger monthly bill.
“SAVE was incredibly generous,” said Scott Buchanan, executive director of the Student Loan Servicing Alliance, a trade group for federal student loan servicers.

The ‘best plan’ for former SAVE borrowers

End of SAVE means bigger student loan bills

But borrowers could see their monthly bills double under IBR, compared with on SAVE.
That’s because the SAVE plan calculated payments based on 5% of a borrower’s discretionary income. IBR takes 10% — and that share rises to 15% for certain borrowers with older loans.

Many federal student loan borrowers simply won’t be able to afford the payments under IBR, said Nancy Nierman, assistant director of the Education Debt Consumer Assistance Program in New York City.
“In severe cases, it could result in people being forced to move, or they will just resign themselves to default and involuntary collections,” Nierman said.
In the new legislation passed by Republicans, borrowers will have access to another income-driven repayment plan, called the “Repayment Assistance Plan,” or RAP, by July 1, 2026.
However, it’s uncertain whether a borrower will have a lower monthly payment on RAP than IBR.
“It’s going to range dramatically based on your income,” Buchanan said.
There are tools available online to help you determine how much your monthly bill would be under different plans.
Carolina Rodriguez, director of the Education Debt Consumer Assistance Program, said she’s working with one partner in a married couple, both with federal student loans, who are facing a nearly $4,000 monthly combined student loan payment under IBR.
“My client said that these payments would mean no extracurricular activities and other opportunities for his children, which might set them back in comparison to their peers,” Rodriguez said.
Under SAVE, the family’s student loan bill would have been around $2,400, she said. 

Borrowers who can’t afford to make a monthly payment on their student debt under the current repayment options can pursue deferment and forbearance options.
Those who’ve taken out loans before July 1, 2027, will maintain access, for example, to the economic hardship deferment and the unemployment deferment, under the new law. More

Amid a fresh set of attacks on Fed Chair Jerome Powell came reports that President Donald Trump might fire the central banker.
Increasingly, Trump is frustrated with Powell for not lowering interest rates already.
Consumers hoping for lower rates as well may be better off if the Fed sticks to its current plan, experts say.

Ahead of the next Federal Reserve meeting later this month, tensions between the White House and the central bank have reached a fever pitch.
On Wednesday, a senior White House official told CNBC and other news outlets that President Donald Trump was likely to soon fire Fed Chair Jerome Powell.

Trump later denied those reports, although he said he wouldn’t “rule out anything.”
Trump has repeatedly said the central bank should have slashed its key benchmark by now. On Friday, Trump once again called Powell “too late” for not lowering interest rates already.
“‘Too Late,’ and the Fed, are choking out the housing market with their high rate, making it difficult for people, especially the young, to buy a house,” Trump wrote in a Truth Social post.
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The president has argued that maintaining a federal funds rate that is too high makes it harder for businesses and consumers to borrow and puts the U.S. at an economic disadvantage to countries with lower rates. The Fed’s benchmark sets what banks charge each other for overnight lending, but also has a trickle-down effect on almost all of the borrowing and savings rates Americans see every day.

Fixed mortgage rates, specifically, don’t directly track the Fed, but are largely tied to Treasury yields and the U.S. economy. As concerns over tariffs and the broader economy drive Treasury yields higher, mortgage rates are following suit.
Powell said July 1 that the Fed likely would have cut rates by now, but that it has held off due to the uncertainty and inflation risks posed by Trump’s trade policies.
As of the latest government reading, consumer prices edged higher in June as tariff-induced inflation started to pick up.

Since December, the federal funds rate has been in a target range of between 4.25%-4.5%. Futures market pricing is implying almost no chance of an interest rate cut when the Fed meets at the end of July, according to the CME Group’s FedWatch gauge.
Even as the pressure to slash rates ramps up significantly, Powell has repeatedly said that politics will not play a role in the Fed’s policy decisions.

‘A reflection of the resilience of the economy’

As it stands, market pricing indicates the Fed is unlikely to consider further interest rate cuts until at least September. Once the fed funds rate comes down, consumers could see their borrowing costs start to fall as well.
“The fact that the Fed has been on the sidelines since December, leaving interest rates unchanged, is a reflection of the resilience of the economy and uncertainty about the path of inflation,” said Greg McBride, chief financial analyst at Bankrate.
“At the point where the Fed does eventually cut interest rates, we’d much rather that be due to easing inflation pressures than an economy that is rolling over,” McBride said.
For now, “inflation is still higher than desired,” he added.

The risk is that reducing rates too soon could halt or reverse progress on tamping down inflation, according to Mark Higgins, senior vice president at Index Fund Advisors and author of “Investing in U.S. Financial History: Understanding the Past to Forecast the Future.”
“Now you have a situation where Trump is willing to pressure the Fed to lower rates while they have less flexibility to do that,” he recently told CNBC. “They have to keep rates higher for longer to extinguish inflation.”
The White House has said that tariffs will not cause runaway inflation, with the expectation that foreign producers would absorb much of the costs themselves. However, many economists expect that the full impact from tariffs on pricing could pick up in the second half of the year as surplus inventories draw down.
For consumers waiting for borrowing costs to ease, they may be better off if the Fed sticks to its current monetary policy, according to Higgins.
“There’s this temptation to move fast and that is counterproductive,” Higgins said. “If the Fed prematurely lowers rates, it’s going to allow inflation to reignite and then they will have to raise rates again.”
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President Donald Trump’s “big beautiful bill” has a section called “no tax on tips.”
But the provision doesn’t eliminate tax on tips, which are still subject to payroll levies.
Instead, it’s a deduction worth up to $25,000 for qualified workers — and it phases out, or gets reduced, once modified adjusted gross income exceeds $150,000.
The tax break is available from 2025 to 2028, but questions remain about eligibility.

President Donald Trump arrives to speak on his plan to end tax on tips in Las Vegas, Jan. 25, 2025.
Mandel Ngan | Afp | Getty Images

President Donald Trump’s “big beautiful bill” includes a section called “no tax on tips” — an idea that both Republicans and Democrats floated during the 2024 campaign.Now that the provision has been enacted, questions remain about how the tax break works and who qualifies.
Despite its name, “no tax on tips” doesn’t eliminate tax on tips, which are still subject to payroll and state taxes. Instead, it’s a deduction worth up to $25,000. The tax break is available from 2025 through 2028. It phases out, or gets reduced, once modified adjusted gross income exceeds $150,000.

However, the IRS needs to clarify which occupations qualify, which is expected to come in early October, according to the agency. 
Meanwhile, “we’re looking at a crystal ball” for guidance, said Larry Gray, a Missouri-based certified public accountant who serves as IRS liaison for the National Association of Tax Professionals.
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In 2023, there were roughly 4 million U.S. workers in tipped occupations, representing 2.5% of all employment, according to estimates from The Budget Lab at Yale University.
The cohort of workers who qualify for the tax break is even smaller — actors, musicians and singers, directors and playwrights — are included among the professions that are already prohibited under the legislation’s text.

Here’s a breakdown of what to know about Trump’s tip deduction. 

What counts as ‘qualified tips’

As written, “qualified tips” are cash tips an employee earns. This includes tips a customer offers in cash or that are added to a credit card charge, as well as payouts under a tip-sharing arrangement.
Yet, the law also says that the tip must be paid voluntarily and determined by the customer or payor, which can put other forms of gratuities or mandatory service charges in question.
“It’s an entirely voluntary transaction,” said Alex Muresianu, a senior policy analyst at the Tax Foundation, a nonpartisan nonprofit focused on tax policy research. 

For example, the definition may exclude mandatory service fees, such as an automatic gratuity a restaurant might tack on for a large dining party. 
“Based on the plain text of the law, it’s hard to argue that that’s something that’s given voluntarily,” said Ben Henry-Moreland, a certified financial planner with advisor platform Kitces.com, who analyzed the legislation.

Tips must be ‘properly reported’

To qualify for the deduction, tips must be “properly reported,” according to Melanie Lauridsen, vice president of tax policy and advocacy at the American Institute of Certified Public Accountants.
That means employers must report the worker’s tips on information returns — such as Form W-2 or 1099 — with a copy going to the employee and the IRS.
However, Trump’s legislation also increased the income thresholds for certain information returns. That could raise eligibility questions for tipped workers who don’t get a form.
For example, Form 1099-K reports business transactions from apps, such as PayPal or Venmo, along with gig economy platforms, such as Uber or Lyft. For 2025, the 1099-K reporting threshold returns to $20,000 and 200 transactions. Previously, the threshold was $2,500 for 2025.
Starting in 2026, the threshold for 1099-NEC, which reports contract income, jumps from $600 to $2,000.
However, there is also uncertainty about whether workers fully disclose cash tips to their employer and the IRS.
“The elephant in the room around this whole ‘no tax on tips’ provision is, so many tips go unreported to begin with,” said Henry-Moreland. More