A federal judge ordered the Trump administration on Thursday to reinstate more than 1,300 U.S. Department of Education employees.

“The Department must be able to carry out its functions and its obligations,” as well as “other relevant statutes as mandated by Congress,” U.S. District Judge Myong Joun in Boston wrote in the injunction.

The U.S. Department of Education announced a reduction in force on March 11 that would have gutted the agency’s staff by a half.

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In a vote early Thursday, House members approved President Donald Trump‘s “big, beautiful” tax bill, including a new savings account for children with a one-time deposit of $1,000 from the federal government.

Under the proposal, “Trump Accounts” — previously known as “Money Accounts for Growth and Advancement” or “MAGA Accounts” — can later be used for education expenses or credentials, the down payment on a first home or as capital to start a small business.  

The final version of the bill that House Republicans passed Thursday could still face pushback in the Senate.

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If the bill passes as drafted, parents will be able to contribute up to $5,000 a year and the balance will be invested in a diversified fund that tracks a U.S.-stock index.

Sen. Ted Cruz, R-Texas, who spearheaded the effort, said the accounts give children “the miracle of the compound growth, the ability to accumulate wealth, which is transformational.”

Not unlike a 529 college savings plan, the Trump Account has a tax incentive to getting a jump start on saving. Earnings grow tax-deferred, and qualified withdrawals are taxed at the long-term capital-gains rate.

“This isn’t all that different from the tax treatment you would get from a typical brokerage account,” said Sam Taube, NerdWallet’s lead investing writer.

Other similar options already exist. Custodial brokerage accounts — often called a UTMA (Uniform Transfers to Minors Act) or UGMA (Uniform Gift to Minors Act) account — also allow parents to transfer bank deposits, stocks, bonds and mutual funds to minors. But in that case, investment income, including dividends and interest, could be subject to a “kiddie tax” charged to the parents at their rate.

With 529 accounts, alternatively, earnings grow on a tax-advantaged basis, and when a child withdraws the money, it is tax-free if the funds are used for qualified education expenses, such as tuition, fees, books, and room and board.

Although there are more limitations on what 529 funds can be applied to compared to Trump Accounts, restrictions have loosened in recent years to include continuing education classes, apprenticeship programs and student loan payments.

Plus, 529 accounts have much higher contribution limits. This year, individuals can gift up to $19,000, or up to $38,000 if you’re married and file taxes jointly, per child.

“For most parents, like myself with teens, the 529 college savings plan is superior if you’re focused on paying for higher education because of the federal tax-free growth,” said Winnie Sun, co-founder and managing director of Sun Group Wealth Partners, based in Irvine, California.

“Also, now, the 529 is becoming more flexible with its’ ability to have unused funds rolled into a Roth IRA in the future for retirement,” said Sun, a member of CNBC’s Financial Advisor Council. 

As of 2024, families can roll over unused 529 funds to the account beneficiary’s Roth individual retirement account, without triggering income taxes or penalties, so long as they meet certain requirements.

Experts say the biggest benefit of Trump Accounts is the seed money for all children born between Jan. 1, 2025, and Jan. 1, 2029, funded by the Department of the Treasury. There are no income requirements and everyone is eligible, as long as the child is a U.S. citizen, and both parents have Social Security numbers.

Although some states, including Connecticut and Colorado, already offer a type of “baby bonds” program for parents, the Trump Accounts — along with a bigger child tax credit proposed in the budget bill — “could certainly help a lot of families at a lot of different income levels,” said NerdWallet’s Taube.

Further, these accounts are not mutually exclusive from other tax-advantaged accounts, like 529 plans, he added, “so parents could take advantage of both.”

Still, for parents weighing their options for early investment vehicles, “my recommendation would be, if you’re focused on college savings, talk to an advisor and start with the 529 plan first,” Sun said. 

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House lawmakers on Thursday morning passed changes for the federal deduction for state and local taxes, known as SALT, as part of President Donald Trump‘s tax package.

Enacted via the Tax Cuts and Jobs Act, or TCJA, of 2017, there’s currently a $10,000 limit on the SALT deduction, and raising that cap has been a priority for certain House lawmakers in high-tax states like New York, New Jersey and California. Filers must itemize deductions to claim the tax break for SALT.

If the House provision is enacted, the SALT cap would rise to $40,000, up from $30,000 in the previous plan, and phases out over $500,000, according to revised language released by the House Rules Committee. The provision would go into effect in 2025.

The SALT cap and income phaseout would increase annually by 1% from 2026 through 2033, according to the text.

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The revised text would also reduce itemized deductions for certain taxpayers in the 37% income tax bracket, which could reduce the benefit of the higher SALT cap.

For 2025, the top rate of 37% applies to individuals with taxable income above $626,350, and married couples filing jointly earning $751,600 or more.

However, the House proposal for changes to the SALT deduction could still face pushback in the Senate.

When filing taxes, you pick the greater of the standard deduction or your itemized deductions, including SALT capped at $10,000, medical expenses above 7.5% of your adjusted gross income, charitable gifts and others.

Starting in 2018, the Tax Cuts and Jobs Act doubled the standard deduction, and it adjusts for inflation yearly. For 2025, the standard deduction is $15,000 for single filers and $30,000 for married couples filing jointly. These could increase under the House-proposed tax bill.

Under the current thresholds, the vast majority of filers — roughly 90%, according to the latest IRS data — use the standard deduction and don’t benefit from itemized tax breaks.

“Any changes to lift the cap would primarily benefit higher earners,” Garrett Watson, director of policy analysis at the Tax Foundation, wrote in an analysis on Tuesday.

With an income phaseout over $400,000, the top 20% of taxpayers “would be the only group to meaningfully benefit,” Watson wrote.

But members of the so-called “SALT Caucus” argue the SALT deduction limit is a middle-class issue in their districts.

Rep. Josh Gottheimer, D-NJ., co-chair of the SALT Caucus, told CNBC’s “The Exchange” on Tuesday that a full repeal of the $10,000 SALT deduction limit would be a “huge tax cut and benefit for middle-class families around the country.”