07/31/2025

One Big Beautiful Bill Act Tax Changes Ahead

Here's some insight from Clark Schaefer Hackett

The recently enacted One Big Beautiful Bill Act (OBBBA) introduces a range of tax provisions that are poised to significantly affect U.S. businesses. While the new law offers a number of business-friendly incentives, it also includes a few less favorable measures that may impact your bottom line. To help you prepare, we’ve outlined key changes that could influence your tax strategy moving forward.

Qualified Business Income (QBI) Deduction

The Tax Cuts and Jobs Act (TCJA) created the Section 199A deduction for QBI for owners of pass-through entities (such as partnerships, limited liability companies and S corporations) and sole proprietorships. The deduction had been slated to expire after 2025, putting many business owners at risk of higher taxes.

The OBBBA makes the QBI deduction permanent. It also expands the deduction limit phase-in ranges for specified services, trades or businesses and other entities subject to the wage and investment limitation. For these businesses, the deduction is reduced when taxable income falls within the phase-in range and is eliminated when taxable income exceeds the range. The new law expands the phase-in thresholds from $50,000 to $75,000 for individual filers and from $100,000 to $150,000 for joint filers.

Please select this link to read the complete article from OSAP mission partner Clark Schaefer Hackett (CSH).