The One Big Beautiful Bill Act (OBBBA), signed into law on July 4, 2025, made sweeping changes to the tax code — and buried in the headlines are several provisions that are genuinely good news for small business owners. Unlike the temporary breaks of years past, many of these are now permanent, which changes how you should think about equipment purchases, investment, and tax planning. Here are four of the most valuable wins.
This is general information, not individual tax advice — how these provisions apply depends on your specific situation.
1. 100% Bonus Depreciation Is Back — Permanently
Under the prior law, bonus depreciation was phasing out — down to 40% for 2025 and headed to zero by 2027. OBBBA reversed course and made 100% bonus depreciation permanent for qualifying property acquired and placed in service after January 19, 2025. In plain terms: instead of deducting the cost of equipment, machinery, or other qualifying assets over several years, you can deduct the entire cost in the year you put it to use. For a business making significant capital investments, that is a powerful, immediate tax benefit.
2. Section 179 Expensing Jumps to $2.5 Million
Section 179 is the other tool for writing off asset purchases immediately, and OBBBA raised the ceiling dramatically — from $1 million to $2.5 million, with the phase-out threshold rising to $4 million, for property placed in service after December 31, 2024. Section 179 and bonus depreciation work together, and the right combination depends on your income and goals. For most small businesses, the practical takeaway is simple: the cost of investing in your business is now more deductible, and sooner, than it has been in years.
3. The 20% QBI Deduction Is Now Permanent
The Section 199A qualified business income (QBI) deduction — which lets owners of pass-through businesses (sole proprietorships, partnerships, and S corporations) deduct up to 20% of their qualified business income — was scheduled to expire. OBBBA made it permanent. It also widened the income phase-in ranges and added a new minimum deduction of $400 for taxpayers with at least $1,000 of QBI from an active business, extending the benefit even to very small operations. For the millions of businesses structured as pass-throughs, this is one of the most valuable provisions in the entire law.
4. Immediate R&D Expensing Is Restored
For a few painful years, businesses had to spread the cost of domestic research and development over five years rather than deducting it immediately. OBBBA restored immediate expensing of domestic R&D costs for amounts paid or incurred beginning January 1, 2025 — and many small businesses (generally those under roughly $31 million in average gross receipts) can apply it retroactively to 2022 and later years. If your business develops products, software, or processes, this is worth a close look.
The Planning Angle
Permanent provisions change strategy. When a tax break is temporary, you rush to use it before it expires; when it is permanent, you can plan deliberately — timing equipment purchases to the years they help most, structuring your business to maximize the QBI deduction, and coordinating depreciation choices with your overall income. The value of these provisions is realized in the planning, not just the filing.
How VarStan Helps
A new tax law is only an opportunity if someone turns it into a plan. As a CPA-led bookkeeping and advisory firm, we help small business owners understand which OBBBA provisions apply to them, model the impact of a major purchase before they make it, and keep the clean records that make claiming these deductions straightforward. If you are planning to invest in your business — or simply want to know what the new law means for your bottom line — that is exactly the conversation we are built for.