How Trump’s “Big Beautiful Bill” Impacts Taxes in North County San Diego

If you live in Encinitas, Carlsbad, or anywhere in North County San Diego, you’re probably wondering: How will Trump’s new tax bill affect me? Officially called the One Big Beautiful Bill Act, this sweeping legislation overhauls key parts of the U.S. tax code—and the effects will be felt right here in coastal California.

Let’s break down the most important changes, who benefits, and who may get left behind.

Keep in mind, any changes will only go in effect from 2026, so for this year the previous rules apply!

1. SALT Deduction Cap Raised — Big Win for Homeowners

North County homeowners finally catch a break. The state and local tax (SALT) deduction cap jumps from $10,000 to up to $30,000 for households making under $500K.

📍 Why it matters: With high property taxes and state income taxes in California, many local residents were hit hard by the old cap. This change means more of your taxes can be deducted—reducing your federal tax bill significantly.

✅ Great news for:

• Dual-income families

• Homeowners in Encinitas, Carlsbad, Del Mar, and Rancho Santa Fe

• Anyone with high property or state tax payments

2. No Federal Tax on Cash Tips

If you or your kids work in hospitality, bartend in Leucadia, or cut hair in San Marcos—this one’s for you. The new bill eliminates federal income tax on cash tips up to $25,000 per year, from 2025–2028.

📍 Income limits apply: $150K (individual) or $300K (joint filers)

✅ Who benefits:

• Servers, bartenders, valets, massage therapists

• Tipped workers in restaurants, salons, and spas along the 101

3. Child Tax Credit and Senior Deductions Go Up (Temporarily)

• Child Tax Credit rises to $2,200 per child, indexed for inflation

• New Senior Deduction offers up to $6,000 for taxpayers 65+

📍 These provisions expire after 2028, so take advantage while you can.

4. Deduct Your Auto Loan Interest (Under Certain Conditions)

Buy a U.S.-assembled vehicle and you can deduct up to $10,000 in loan interest—a nice bonus for families upgrading cars.

5. Medi-Cal and SNAP Cuts Could Hurt Lower-Income Families

Here’s where things get serious. The bill includes deep cuts to Medicaid (Medi-Cal) and SNAP (food assistance):

• Medi-Cal funding reduced by 19% over 10 years

• Stricter work requirements and eligibility rules

• Potential closures of clinics or service reductions in North County

📍 Local impact: Encinitas and Oceanside residents who rely on public programs may face longer wait times, fewer services, or loss of coverage altogether.

Net Effect: What It Means for You

North County Resident Type	Outcome
Homeowners < $500K income	Tax savings from SALT deduction increase
Tipped service workers	Up to $25,000 in tax-free income (if in cash)
Parents & seniors	Modest benefits—temporary
Lower-income households	Face cuts to Medi-Cal and food assistance
High-income earners	Maintain Trump-era lower tax brackets

What’s Next?

While many North County families will see short-term tax savings, the cuts to healthcare and assistance programs could impact vulnerable populations and older residents.

📌 Bottom line: If you own a home or earn tips, you might get a break. But if you rely on Medi-Cal or public assistance, it’s time to plan ahead—changes are coming fast.

Want Help Navigating These Tax Changes?

At Cardiff Tax Pros, we specialize in helping North County residents maximize their tax savings. Whether you're a homeowner in Encinitas, a salon owner in Carlsbad, or a retiree in Rancho Santa Fe—we’ll guide you through the new rules.

📞 Call us today or book a free consultation: cardifftaxpros.com