As 2025 began, individual and business taxpayers faced mounting uncertainty, with key provisions of the 2017 Tax Cuts and Jobs Act (TCJA) scheduled to expire. On July 4, 2025, President Trump signed the One Big Beautiful Bill Act (OBBBA) into law, delivering sweeping changes that offer continued tax relief for taxpayers and entrepreneurs, while introducing new planning opportunities that warrant close attention. Below is a summary of some of the most impactful changes for you and your business.
Permanent Tax Rate Reductions
The top marginal tax rate remains at 37%, permanently extending TCJA’s lower rate structure. (Note that itemized deductions are also now “capped” at the 35% rate)
These brackets are now permanent and will adjust annually for inflation, beginning in 2026.
This provides long-term planning stability for high-income earners, especially those with pass-through income.
Pass-Through Deduction Preserved
The 20% Qualified Business Income (QBI) deduction for pass-through entities (e.g., S corps, partnerships, sole proprietorships) continues without a sunset, a major win for entrepreneurs and investors.
High earners in specified service trades (law, health, consulting, etc.) still face income thresholds, so careful structuring remains key.
Bonus Depreciation and R&D Expensing
100% bonus depreciation is now permanent, enabling continued full expensing of capital investments in the year of acquisition.
Immediate expensing of domestic research & development costs is also preserved (including deductions of previously capitalized R&D), promoting innovation and long-term growth strategies.
Expanded SALT Deduction — Temporarily
The state and local tax (SALT) deduction cap rises to $40,000 in 2025, with modest increases through 2029.
The higher cap phases out for households above certain income thresholds and reverts to $10,000 in 2030.
For high earners in high-tax states (e.g., NY, CA, NJ), this offers a short-term tax reduction opportunity.
Note: Pass through entity tax (PTET)
regimes remain largely unaffected, which was welcome news.
Estate and Gift Tax Planning
The federal estate and gift tax exemption climbs to $13.99 million per person in 2025, increasing to $15 million in 2026.
For married couples, this provides up to $30 million in exemption.
Qualified Small Business Stock (QSBS) Gains Enhanced
QSBS exclusion increases to $15 million, with the “vesting” exclusion as follows:
50% gain exclusion for (qualifying) shares held more than three years,
75% gain exclusion for shares held more than four years, and
100% gain exclusion for shares held more than five years.
This provides a significant capital gains exclusion opportunity for founders and early-stage investors (in qualified businesses).
(Note: Must meet other eligibility rules under Section 1202)
New Auto Loan Interest Deduction
Deduction of up to $10,000 annually, on interest for loans used to finance U.S.-assembled vehicles.
Available through 2028, with income-based phaseouts.
Tax Deferral for Farmland Sales
A new provision allows sellers of qualified farmland property to qualified farmers to defer capital gains over four years.
This promotes generational transfer, eases the tax burden on sellers and supports continuity in family-owned or local agricultural operations.
For individuals and business owners, these are just some of the substantial tax reliefs that the One Big Beautiful Bill Act delivers and opens doors for sophisticated wealth strategies. However, the law’s mixed durations, phased expirations and income caps mean that careful planning is essential to take full advantage of its benefits.
Now is the time to meet with your CPA, estate planner and financial advisor to lock in long-term advantages and position your business and family for what’s next.
Elizabeth Shauger, CPA, is a Director with Mauldin & Jenkins in Bradenton, Florida. With over 15 years of tax experience, she specializes in corporate, partnership, and high-net-worth individual taxation. She holds degrees from Florida International University and Nova Southeastern University and lives in Tampa with her husband and two sons.
