Trump's new law means states face major budget and program decisions in 2026.

A federal law signed last year shifts more program responsibilities and costs to states, affecting Medicaid, SNAP and some tax rules. State legislatures will begin considering these changes when they convene in January.

A sweeping federal law signed by President Donald Trump last year is shifting more program responsibilities and costs to state governments. The changes affect major social programs including Medicaid and the Supplemental Nutrition Assistance Program and include temporary federal tax provisions. State legislatures and governors are expected to begin addressing these matters when sessions start in January. Key developments: - The law shifts more responsibilities and costs to states for programs such as Medicaid and SNAP. - SNAP administrative costs will move toward greater state responsibility starting Oct. 1, and some states could face payment liability rules starting in late 2027. - New Medicaid work requirements must be in place for most states by January 2027, and some states (for example, Nebraska) have announced earlier start dates. - States must decide whether to adopt recent federal tax changes into their own income tax codes; some states have already moved to conform while others will decide in upcoming sessions. Summary: States are likely to face increased budget pressure as they weigh how to absorb administrative costs, implement new Medicaid rules, and consider whether to mirror federal tax changes at the state level. Legislatures convening in January will be the main venue for those decisions, and specific state responses remain under consideration.