Signed into law on July 4, 2025, the One Big Beautiful Bill Act (OBBBA) is packed with tax tweaks, credits, and compliance updates that could affect your bottom line—especially if you run a small or medium-sized business. Here’s what you need to know, without the legal jargon.
💰 1. Bigger Bonus Depreciation, But With a Sunset
- 100% bonus depreciation is back—for qualified property placed in service between 2025 and 2027.
- After 2027, it phases down by 20% per year until it disappears in 2031.
- Great for businesses investing in equipment, vehicles, or tech upgrades.
🧾 2. Section 179 Expensing Gets a Boost
- Deduction limit increased to $2 million, with phase-out starting at $10 million.
- This lets you write off more of your purchases immediately, rather than depreciating over time.
🏦 3. R&D Credit Made Simpler (and More Generous)
- Startups can now apply up to $750,000 of R&D credit against payroll taxes (up from $500,000).
- Eligibility expanded to include businesses with up to $10 million in gross receipts.
📉 4. Corporate Rate Stays Flat—But Watch Pass-Throughs
- C-corp rate remains at 21%, no change.
- Pass-through deduction (Section 199A) preserved, but with new guardrails:
- Income limits and wage thresholds now indexed for inflation
- More scrutiny on service businesses—consult your CPA if you’re in law, finance, or health
🧑💼 5. Employee Retention Credit (ERC) Revival—With Strings
- ERC reinstated for Q3 and Q4 of 2025, but only for businesses:
- With under 500 employees
- That show a 25% drop in gross receipts compared to the same quarter in 2024
- Audit risk is high, so documentation is key
🏥 6. Health Reimbursement Arrangements (HRAs) Expanded
- Businesses can now offer Integrated HRAs to more employees, with higher contribution limits
- Easier to pair with group health plans, giving you more flexibility in managing benefits
⚠️ Final Thought: Don’t Miss the Hidden Gems
OBBBA isn’t just about taxes—it’s about strategic planning. Whether you’re buying new equipment, hiring staff, or investing in innovation, these changes could mean real savings—if you act before the sunset provisions kick in.
Want help modeling how these changes affect your business? Let’s run the numbers together!