OBBBA 2025: What Small Business Owners Need to Know

Introduction

The One Big Beautiful Bill Act (OBBBA), signed into law on July 4, 2025, is one of the most significant tax reforms in recent years. For small business owners, the law offers major tax breaks, enhanced deductions, and expanded credits — but also phases out certain clean energy incentives and adds new compliance requirements. Here’s a quick breakdown.

Key Tax Benefits for Small Businesses

1. Bigger Upfront Deductions

100% Bonus Depreciation is now permanent — allowing you to fully deduct new and used asset purchases in the year you buy them.

Section 179 Expensing limit rises to $2.5M in 2025, making it easier to write off equipment and technology costs.

2. R&D Deduction Boost

Domestic R&D expenses can be fully deducted in the year they’re incurred.

Businesses with under $31M in annual revenue can retroactively claim deductions for 2022–2024.

3. Pass-Through and Investment Incentives

20% Qualified Business Income (QBI) deduction is now permanent, with higher income limits.

Qualified Small Business Stock (QSBS) gains qualify for up to 100% exclusion after 5 years, with a higher $15M cap.

Employee & Hiring Benefits

Child Care Credit-

Employers can claim 40% to 50% of eligible child care expenses (up to $600K for small businesses).

Paid Family & Medical Leave Credit-

Permanently extended, helping offset costs for offering leave benefits.

Student Loan Repayment-

Tax-free employer contributions (up to $5,250/year) are now permanent.

What’s Going Away

Clean energy credits for commercial EVs end Sept 30, 2025.

Fueling station credits and energy-efficient building deductions end June 30, 2026.

SALT deduction cap raised to $40K through 2029, then back to $10K.

Quick Takeaways

Act fast: Some incentives are time-sensitive.

Plan ahead: Clean energy credits are phasing out.

Get advice: A tax pro can help you maximize these changes.

Bottom Line

The OBBBA brings big opportunities for small business owners to lower taxes, invest in growth, and support employees. But deadlines matter — and planning now is key to getting the most from the new rules.

About the author:

Paul Carriere CFP® provides fee-only financial planning and investment management services in Colorado Springs, Co. Carriere Financial Planning serves clients as a fiduciary and never earns a commission of any kind. Paul has over 10 years of experience as a financial advisor in Colorado Springs.

* This content is developed from sources believed to be providing accurate information. The information provided is not written or intended as tax or legal advice and may not be relied on for purposes of avoiding any Federal tax penalties. Individuals are encouraged to seek advice from their own tax or legal counsel. Individuals involved in the estate planning process should work with an estate planning team, including their own personal legal or tax counsel. Neither the information presented, nor any opinion expressed constitutes a representation by us of a specific investment or the purchase or sale of any securities.