This article was originally published at 12:55 p.m. CDT on Tuesday, July 1. It was last updated with additional information at 3:39 p.m. CDT on Tuesday, July 1.

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OMAHA (DTN) -- Vice President JD Vance on Tuesday broke a 50-50 tie in the Senate to pass President Donald Trump's centerpiece legislation on tax cuts and spending, the "One Big Beautiful Bill."

The bill also includes several farm bill provisions that will improve the farm program safety net.

In the big picture, the bill makes permanent some of President Trump's 2017 tax cuts and extends others in the process. The bill also makes deep cuts to social programs such as Medicaid and the Supplemental Nutrition Assistance Program (SNAP). The bill adds as much as $175 billion for border and immigration enforcement.

Congress is trying to get the bill to the president's desk by July 4, though there are differences between the House version passed in May and the Senate bill.

The House Rules Committee rushed into an afternoon session Tuesday, which lined up the House for a possible vote on the Senate bill as early as Wednesday.

The House passed its version of the bill in May on a 215-214-1 vote. Republicans hold a razor-thin margin in the House, but conservatives likely now will be asked to accept the Senate version of the bill. The House made steeper cuts to spending than the Senate.

GOP leaders in the Senate cut some late deals this week to secure votes, such as excluding certain states from having to pay a share of food assistance even though they have the highest error rates for payment in the country.

TAX PROVISIONS

The Senate bill makes permanent a 20% deduction for qualified business income for smaller businesses. The Senate language is different from the House, which increases the qualified business income deduction to 23%.

When it comes to buying equipment, the bill reinstates 100% bonus depreciation from 2025-2030 and also increases the Section 179 deduction for smaller businesses to $2.5 million.

The bill would increase the estate tax exemption to $15 million for single tax filers and $30 million for married couples starting in 2026 and the exemption would be indexed for inflation.

The Senate version also adds a provision that would allow income tax resulting from the sale of farmland to a qualified farmer to be paid in four annual installments instead of all at once. Such farmland must have been in agriculture production for the past 10 years to qualify and must remain in agriculture for 10 years after the sale occurs.

The Senate version also extends the 45Z Clean Fuel Production Credit. Under the bill, only feedstocks from the U.S., Canada and Mexico would qualify for the tax credit. The Senate bill extends the 45Z through the end of 2029, compared to the House bill that extends the credit through 2031.

The National Corn Growers Association (NCGA) also noted the Senate language cuts the top payment rate for the 45Z credit from $1.75 to $1 a gallon.

The Senate also expanded the Small Agri-Biodiesel Producer credit from 10 cents to 20 cents a gallon.

In another late move on the bill, senators removed some tax provisions that would have penalized wind and solar developers for using materials from China. To receive some other tax breaks, the Senate bill will require wind and solar projects to be placed in service by the end of 2027 to qualify.

The National Council of Farmer Cooperatives also noted the Senate provides permanent tax relief to cooperatives through the Section 199A provision.

The National Cattlemen's Beef Association pointed to tax relief on estate taxes, Section 199A and the Section 179 deduction. NCBA also noted the Senate bill doesn't include "controversial provisions" such as public land sales or eminent domain. NCBA called on the House to pass the bill and send it to the president.

For individuals, the bill also increases the standard income deduction as well as the child tax credit for couples and exempts taxes on tips for people through 2028.

AG PROVISIONS IN THE BILL

The bill includes improvements to the farm safety net with as much as $68.3 billion in program changes over 10 years.

That includes raising reference prices under the Price Loss Coverage program (PLC) and the Agriculture Risk Coverage (ARC) program. For the current crop year, the Senate bill has language that USDA will provide producers with the higher calculated payment rate in 2025 for ARC or PLC. Producers would then go back to choosing which program they prefer in 2026 and beyond. The Senate change will add more than $54 billion to PLC and ARC over 10 years.

Crop insurance programs would see about $6.3 billion in increased spending over 10 years, with higher subsidies for some supplemental area-based plans and other improvements to premium support.

Disaster relief programs at USDA for livestock are improved at a cost of about $2.9 billion over 10 years.

The Dairy Margin Coverage (DMC) is increased, and the bill also reduces crop-insurance premiums for farmers.

Another provision would boost economic assistance to textile mills as well.

Payment limits would increase from $125,000 to $155,000 for individuals, and then the payment limit would increase based on an inflation index. The bill also removes income caps for farmers or entities that draw 75% or more of their income from agriculture or forestry.

The bill also has provisions that would allow USDA to enroll up to 30 million new base acres for farmers based on the production history of that ground.

In conservation, the bill takes back as much as $16 billion from the Inflation Reduction Act (IRA) and rolls those funds into the 10-year budgets for USDA's main conservation programs. Still, the CBO forecasts that move as a nearly $1.8 billion in cuts compared to what the IRA and farm bill funding could have provided for conservation programs.

Other provisions in agriculture would double funding for USDA trade promotion programs as well.

FOOD AID CUTS

The bill was projected to cut food aid for low-income people by $185.9 billion over 10 years, mainly by tightening provisions around the country's largest food-aid support program, the Supplemental Nutrition Assistance Program (SNAP). Work restrictions would be tightened for able-bodied adults, people ages 55-64 and parents with children over age 14. The bill also restricts the Agriculture secretary from offering waivers to SNAP work requirements based on areas with higher unemployment rates. Combined, the work requirements would reduce SNAP spending by $92 billion over 10 years.

Oddly enough, one of the last debates on the bill guts one of the SNAP saving provisions Republicans in Congress touted the most. The bill would require paying as much as 15% of the SNAP benefits based on USDA's report of their annual error rates. That provision would kick in 2028 and shift more than $4 billion in annual costs to states. Another cost shift to states increases their percentage of the administrative costs as well.

However, to secure the vote of Sen. Lisa Murkowski, R-Alaska, the Senate added a provision that would give states with the highest SNAP error rates another two additional years to bring their error rates down before being penalized.

Beyond Alaska, the language helps both GOP-led states and Democratic-led states of Maryland, Oregon, New York, Massachusetts, New Jersey, New Mexico, Florida, Georgia and the District of Columbia, Sen. John Boozman, R-Ark., chairman of the Senate Agriculture Committee, noted.

Sen. Amy Klobuchar, D-Minn., ranking member of the Senate Agriculture Committee, tried Wednesday to strip that provision from the bill, but her amendment was voted down.

"The biggest hypocrisy of the entire bill: the Republicans have rewarded states that have the highest error rates in the country, ten states with the highest error rates, just to help Alaska, which has the highest error rate," Klobuchar noted. She added, "For the rest of us, all of the states in the Midwest that are doing their best, they have got to pay in."

Just Monday, Boozman joined House Agriculture Committee Chairman Glenn "GT" Thompson, R-Pa., to issue a news release highlighting USDA's latest report error rates and praising how the legislation will hold states accountable. "Its historic reforms will give states skin in the game on SNAP benefits and ensure they have a real incentive to improve oversight and stop improper payments before they happen," the news release stated.

See, "Midwest Food Banks Warn They Can't Fill Gap if SNAP is Cut in Budget Bill," https://www.dtnpf.com/…

Also see, "Senate Ag Reconciliation Bill Offers Farmers Better Options for 2025 Programs," https://www.dtnpf.com/…

Also see, "Six Tax Changes Made for Farm Businesses in the 'One Big Beautiful Bill,'" https://www.dtnpf.com/…

Chris Clayton can be reached at Chris.Clayton@dtn.com

Follow him on social platform X @ChrisClaytonDTN

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