When the One Big Beautiful Bill Act was signed into law, it became one of the most expansive tax packages in recent years.
The tax benefits provided in the new law for businesses are advantageous, but the scope of changes can be overwhelming, largely due to the staggered timeline of dates for the provisions. Some dates were retroactive; other dates sunset. Some effective dates have requirements as to when assets must be placed.
“Navigating the effective dates is a primary consideration for business owners, given the non-uniform nature of the law's rollout,” said Kylee Fraze Norman, a partner with CLH, CPAs & Consultants.
On its Own Time
Norman said the complexity for business owners is less about understanding the minute details of every provision (that’s where tax professionals come in, she noted), and more about recognizing when each one applies, and then aligning strategy accordingly.
These are unlike sweeping reforms that flip on a single, given calendar day, she said.
“For example, one of the most high-profile provisions for capital-intensive investment is the 100% bonus depreciation that applies to acquisitions made after Jan. 19, 2025,” said Norman.
For those managing capital projects, the dates matter. An acquisition completed just weeks earlier could produce a different, less desirable tax outcome.
Meanwhile, research and development carries its own timeline in the new law, where domestic R&E expenditures can once again be immediately expensed beginning Jan. 1, 2025. “There is a retroactive provision for 2022 through 2024 for qualifying small businesses,” said Norman.
Every core provision for businesses carries with it its distinct timeline.
The SALT cap increase is temporary (2025–2029), the QBI deduction is now permanent, as is the excess business loss limitation. Various energy credits are nearing expiration.
OBBBA Strategy Requires Structure
As the timeline of effective dates is so fragmented, strategic and proactive planning is imperative.
Norman emphasized that companies should be engaging closely with their advisors at this time.
“Ideally, they should be meeting each year-end with their professional advisors to discuss planning opportunities for the following year,” she noted. “Companies should evaluate their capital expenditures and net income while determining whether to utilize 100% bonus depreciation. Although the new law made this provision permanent, that does not necessarily make it the optimal strategy for every business at this time.”
Norman suggested that businesses can offset the law's complexity through meticulous record-keeping.
“The most effective way to leverage tax planning is to prioritize accurate internal accounting,” she said. “By doing so, you eliminate surprises regarding your financial position as you navigate tax planning under the OBBBA.”
For those company leaders who have not engaged in structured tax planning, Norman said it’s never too late, but with the tax reform that is occurring now, it has never been more imperative.
“Prioritize consulting with a qualified tax professional to begin the planning process. Evaluate the new law’s provisions to determine how they might favorably impact your business from a tax standpoint. These discussions must be tailored, as every business and financial situation is unique.”
