On July 4th, 2025, President Trump signed the One Big Beautiful Bill Act (BBB) into law, bringing significant tax changes that could save your business thousands of dollars.
You’re already juggling daily operations while trying to stay compliant with ever-changing tax regulations. Add trying to understand these new provisions to the list, and it can all feel pretty overwhelming.
But missing out on these updates or not properly understanding their implications could cost your business thousands. The BBB Act introduces substantial changes that could reshape your tax strategy for years to come – permanent improvements to research and development deductions, bonus depreciation rules, and pass-through entity benefits that directly impact small businesses.
So to help, we’re breaking it all down for you!
What you'll learn in this article:
- Which BBB Act provisions directly impact your business
- How much you could potentially save in taxes
- Immediate action steps to take before year-end
- Why these changes matter for small businesses
Keep reading or connect directly with a Hiline tax expert for support.
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What is the One Big Beautiful Bill Act?
The One Big Beautiful Bill Act represents one of the most significant tax reform packages since the Tax Cuts and Jobs Act of 2017.
Key highlights:
- Signed into law on July 4th, 2025
- Addresses temporary provisions that were set to expire
- Introduces new benefits specifically for American businesses
- Many provisions are permanent, providing long-term planning stability
Who benefits:
- Businesses that invest in research and development
- Companies purchasing equipment regularly
- Pass-through entities (S-corps, partnerships, LLCs)
- Small business owners across all industries
Unlike previous tax changes with sunset clauses, these permanent provisions give business owners the certainty they need for strategic planning.
Below we’ll break down some of the most important of these changes into 3 categories: Individual tax changes, Business tax changes, and Reporting & Compliance changes.
Individual Tax Changes That Affect Business Owners
1. Section 199A QBI Deduction: The Big Win for Pass-Through Entities
The bottom line: The 20% Qualified Business Income deduction is now permanent and expanded.
What changed:
- Previously set to expire after 2025, now permanent
- Phase-out limits increased from $100K to $150K (married filing jointly)
- Single filers: phase-out increased from $50K to $75K
- New minimum $400 deduction for qualifying income over $1,000
Why this matters: Higher-income business owners who previously faced restrictions can now benefit from the expanded phase-out ranges.
2. SALT Cap Relief
The change: State and Local Tax deduction cap (SALT) increases from $10,000 to $40,000 for most taxpayers.
Key benefits:
- Applies to taxpayers earning $500K or less in modified AGI
- Eliminates SALT limitations entirely for pass-through entities
- Partnerships, S-corps, and LLCs can deduct state/local taxes without restriction
- Provides substantial tax planning opportunities in high-tax states
3. Other Notable Individual Changes
Standard deduction increases (effective January 1, 2025):
- Single filers: $15,750
- Married filing jointly: $31,500
- Head of household: $23,625
Car loan interest deduction:
- Deduction for up to $10,000 of interest on new car loans (2025–2028)
- Must be US-assembled passenger vehicles with the vehicle serving as security for the loan
Estate tax benefits:
- Exemption increases to $15 million per person
- Now permanent for business succession planning
Service industry benefits (temporary through 2028)*:
- Tips deduction: up to $25,000 annually
- Overtime pay deduction: up to $12,500 annually for individuals; $25,000 for joint returns
* Available to people with an AGI of $150,000 or less for single filers and $300,000 for joint filers
Game-Changing Business Tax Provisions
1. Research & Development Expenses – Immediate Relief
The big change: Full expensing of domestic R&D costs starting January 1, 2025.
This reverses the 2022 requirement to amortize R&D expenses over five years, dramatically improving cash flow for innovative companies.
Additional benefits:
- Small businesses can apply this retroactively back to 2022
- Option to file amended returns for immediate refunds
- Ability to accelerate remaining Section 174 deductions
- Foreign R&D remains at 15-year amortization
Who this affects most:
- Technology companies
- Manufacturers developing new products
- Businesses investing in process improvements
- Software development companies
- Any small business with qualifying research activities
Example impact: A software company that spent $100,000 on U.S. development costs can now deduct the full amount immediately, rather than $20,000 annually over five years.
2. Bonus and Sec 179 Depreciation – Back to 100%
The win: Permanent 100% bonus depreciation for qualified property acquired after January 19, 2025.
Section 179 improvements:
- Expense limit increases to $2.5 million (from $1.16 million)
- Phase-out threshold rises to $4 million (from $2.89 million)
- Both changes are permanent
Strategic opportunity example: A construction company purchasing $500,000 in equipment can immediately expense the entire amount rather than depreciating over several years, providing substantial first-year tax savings and improved cash flow for reinvestment.
3. Qualified Small Business Stock (QSBS) Changes – Better for Startups
The BBB Act modifies QSBS rules to create a tiered exclusion system based on holding periods.
New tiered exclusion system:
- 50% exclusion after 3 years (previously required 5 years)
- 75% exclusion after 4 years
- 100% exclusion after 5+ years
Expanded eligibility:
- Asset limit increased from $50 million to $75 million
- More growing businesses now qualify
- Better flexibility for exit planning
Example benefit: A founder selling qualified stock after four years can exclude 75% of the gain from federal taxation, potentially saving thousands in taxes.
Important Changes for Reporting & Compliance
1. Form 1099 Reporting Thresholds – Administrative Relief for Businesses
General 1099 reporting:
- Threshold increases from $600 to $2,000
- Applies to payments made during trade or business
- Effective for calendar years after 2025
Form 1099-K reporting:
- Reverts to previous threshold: $20,000 AND 200 transactions
- Eliminates burden from the lower $600 threshold
- Reduces compliance paperwork significantly
What this means:
- Less time on administrative tasks
- Fewer forms to track and distribute
- More focus on core business operations
2. Charitable Deduction Modifications
Corporate charitable giving change:
- New 1% floor for deductions, meaning only contributions above 1% of taxable income qualify
- Still subject to the existing 10% limit
Impact assessment: While this change affects businesses that donate regularly, most small businesses donating modest amounts relative to their income will see minimal impact.
Planning tip: Review charitable giving strategies to ensure donations above the 1% threshold maximize tax benefits.
What This Means for Your Business
Business owners should take immediate action to capitalize on these changes before year-end.
Immediate Action Items for 2025
1. Review any qualifying equipment purchases you've been considering – Evaluate whether accelerating them into 2025 makes sense under the enhanced bonus depreciation rules. Take advantage of 100% immediate expensing.
2. R&D expense review – Assess R&D expenses from 2022-2024. Consider filing amended returns to claim immediate deductions rather than continuing multi-year amortization. This strategy could provide significant cash flow improvements that can be reinvested in growth initiatives.
3. Pass-through entity optimization – Work with your tax advisors to optimize your QBI deduction under the expanded phase-out limits and plan for the permanent nature of this benefit. The increased predictability allows for more aggressive business expansion plans without worrying about temporary tax provisions expiring.
How Hiline Can Help You Navigate These Changes
Navigating the BBB Act's complex provisions requires expertise in both tax law and strategic business planning. We understand how these tax changes interact with your specific business model and can help you:
- Identify new tax optimization opportunities
- Ensure compliance with new reporting requirements
- Develop customized strategies aligned with your business goals
- Integrate tax planning with monthly financial reporting
- Amended returns for R&D expenses back to 2022
- Support pass-through entity tax optimization
- Multi-state tax planning considerations
Client success example:
Jahnel Group, a growing software development company, unlocked over $1 million in tax savings after partnering with Hiline. Through proactive identification of R&D tax credits worth $1.1 million over four years and strategic conversion from accrual to cash basis accounting, Hiline helped defer $1 million in taxable income during the first year alone. The company also benefited from enrollment in state tax incentive programs and modernized cloud-based accounting operations that saved hundreds of hours annually.
Frequently Asked Questions
Q: When do these BBB Act changes take effect? Most provisions became effective January 1, 2025. Bonus depreciation applies to property acquired after January 19, 2025. R&D expense changes allow retroactive application back to 2022 through amended returns.
Q: Do these changes apply to my business structure? Yes, most business structures benefit. Pass-through entities (S-corporations, partnerships, LLCs) see particularly strong advantages. C-corporations also benefit from R&D and bonus depreciation provisions.
Q: Should I amend previous tax returns? Businesses with significant R&D expenses from 2022-2024 should evaluate amended returns. The ability to claim immediate deductions rather than continuing amortization could provide substantial cash flow benefits. Consult your tax advisor to determine if benefits outweigh costs.
Q: How much could my business save? Savings vary based on business type, income level, and qualifying expenses. Businesses with substantial equipment purchases or R&D investments could save tens of thousands annually. Smaller businesses will see more modest but still meaningful reductions.
Your Next Steps for BBB Act Tax Benefits
The One Big Beautiful Bill Act provides significant opportunities for business owners to reduce tax liabilities while gaining long-term planning certainty.
Key takeaways:
- Permanent QBI deductions provide ongoing benefits
- Enhanced R&D expensing improves cash flow immediately
- Bonus depreciation creates strategic equipment purchase opportunities
- Many provisions are permanent, enabling better long-term planning
The complexity of these provisions makes professional guidance essential. Don't let valuable opportunities pass by.
Ready to maximize your BBB Act savings? Schedule a consultation with Hiline's tax experts today. Our team will analyze your specific situation, identify optimization opportunities, and implement changes that deliver immediate and long-term benefits for your business.
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