How the One Big Beautiful Bill Act Affects Business Tax Planning
Key Considerations for Business Owners and Tax Professionals
The One Big Beautiful Bill Act (OBBBA) introduces a range of tax provisions that create both opportunities and added complexity for businesses and their advisors. While many of these provisions extend policies first introduced under the Tax Cuts and Jobs Act, OBBBA provides increased certainty by making several key incentives permanent.
For business owners, CFOs, and tax professionals, the focus now shifts to understanding how these changes influence capital investment decisions, entity structures, financing strategies, and long-term tax planning. Because many of the provisions interact with one another, effective planning often requires a coordinated approach that aligns tax strategy with broader financial and operational goals.
Outlined below are several OBBBA provisions that warrant closer review.
Capital Investment Strategy and Bonus Depreciation
OBBBA permanently restores 100 percent bonus depreciation for qualifying property acquired after January 19, 2025, allowing businesses to fully expense certain capital investments in the year they are placed in service.
For organizations planning equipment purchases, facility expansions, or other significant capital projects, this provision can accelerate deductions and enhance near-term cash flow. Maximizing the benefit, however, often requires careful analysis of asset classification, project timing, and related tax rules.
Planning considerations include:
Evaluating the timing and structure of planned capital expenditures to confirm eligibility for accelerated deductions
Assessing whether cost segregation studies may identify additional assets eligible for faster depreciation
Reviewing how federal bonus depreciation aligns with applicable state tax rules
Coordinating capital planning with long-term tax projections and investment strategies
CSH works with businesses to evaluate capital investment plans and identify opportunities to optimize depreciation benefits while maintaining compliance with complex tax requirements.
Research and Experimental Expensing
Beginning in 2025, domestic research and experimental (R&E) expenditures may once again be fully expensed rather than amortized over five years.
For companies engaged in product development, engineering, manufacturing innovation, or software development, this change can have a meaningful impact on tax cash flow. Determining eligibility and properly documenting qualifying activities often requires detailed technical analysis.
Planning considerations include:
Evaluating whether current activities qualify for R&E treatment
Assessing whether amended returns may be appropriate for prior tax years
Coordinating R&E deductions with available research and development tax credits
Reviewing documentation and substantiation processes for qualifying expenses
CSH’s tax professionals and specialty credit teams assist organizations in evaluating eligibility, identifying missed opportunities, and supporting documentation requirements.
Qualified Business Income Deduction Permanency
OBBBA makes the 20 percent Qualified Business Income (QBI) deduction permanent, providing long-term certainty for pass-through businesses.
Despite its permanency, the deduction remains subject to wage limitations, asset thresholds, and restrictions for specified service trades or businesses. Evaluating how compensation strategies, taxable income levels, and entity structures affect the deduction often requires detailed modeling.
Planning considerations include:
Reviewing compensation and wage structures that influence deduction limitations
Modeling taxable income scenarios to assess eligibility thresholds
Evaluating entity structures and ownership arrangements that affect the calculation
Considering how compensation and distribution strategies impact overall planning outcomes
CSH works closely with business owners and finance leaders to model QBI scenarios and align tax strategy with compensation and entity planning objectives.
SALT Deduction and Pass-Through Entity Tax Strategies
OBBBA temporarily increases the individual SALT deduction cap to $40,000 beginning in 2025, while pass-through entity tax (PTET) elections remain available.
For owners of pass-through businesses, evaluating PTET strategies alongside entity structure considerations may generate meaningful federal tax benefits. These strategies often become more complex for businesses with multistate operations or layered ownership structures.
Planning considerations include:
Evaluating whether PTET elections continue to provide federal tax advantages
Assessing the impact of multistate operations on overall SALT strategy
Considering whether entity structure changes could improve tax efficiency
Monitoring evolving state-level guidance and responses
CSH’s SALT specialists work with businesses to evaluate these strategies and navigate the complexities of multistate tax planning.
Business Interest Deduction Changes
OBBBA restores the EBITDA add-back when calculating adjusted taxable income under the Section 163(j) business interest limitation, potentially allowing businesses to deduct a larger portion of their interest expense.
For organizations with significant debt or financing activity, this change may influence not only tax compliance but also broader capital and financing strategies.
Planning considerations include:
Evaluating how the revised calculation affects current and projected interest deductions
Identifying previously suspended interest that may now be deductible
Reviewing financing structures and debt strategies under the updated rules
Incorporating these changes into tax projections and financial planning
CSH’s tax advisors assist businesses in evaluating how financing decisions intersect with tax planning under the revised rules.
Navigating OBBBA with the Right Expertise
While OBBBA provides greater certainty around several major tax provisions, the interaction between these rules and broader business decisions can be complex. Effective tax planning often requires coordination across tax, finance, operations, and long-term growth strategies.
CSH works with business owners, CFOs, and tax professionals to interpret complex tax legislation and implement practical, forward-looking planning strategies. Our team brings deep technical expertise in areas including cost segregation, R&D incentives, SALT planning, and transaction readiness.
To explore how OBBBA may affect your organization, contact your CSH advisor or connect with our tax specialists.
This article is intended for informational purposes only and does not constitute tax, legal, or accounting advice. Businesses and advisors should consult with their CSH advisor or another qualified tax professional regarding their specific circumstances.
