By Jeana Goosmann, Founder, CEO, and Practicing Attorney, Goosmann Law Firm
On July 4, 2025, President Trump signed the One Big Beautiful Bill Act (OBBBA) into law—a sweeping, multi-sector tax reform that cements many Tax Cuts and Jobs Act (TCJA) provisions and introduces new incentives and deductions. For business owners, estate planners, and executives, the law creates both new opportunities and potential pitfalls.
Key Provisions, Context & Real-World Examples
Provision
QBI Deduction
What It Means
The 20% pass-through deduction is now permanent, the phase-in income limitations have increased, and taxpayers with at least $1,000 of qualifying income from active qualified trades or businesses have an inflation-adjusted minimum deduction of $400.
Projected Impact
A Midwest manufacturing firm can now forecast consistent tax savings, bolstering plans for expansion or new hires.
Full Expensing of Domestic Research & Experimental Expenditures
Businesses can immediately deduct 100% of qualifying domestic research and experimental expenditures or, at the taxpayers’ election, capitalize and amortize costs (i) over a period of 60 months, or (ii) over ten years.
A tech startup investing in new lab equipment has increased flexibility in how it writes off the expense, allowing it to optimize its overall tax position.
New Deductions: Tips & Overtime
Employees can deduct up to $25,000 for tips and $12,500 for overtime.
A family‑owned restaurant could highlight these perks to recruit and retain service staff, enhancing employee benefits at low cost.
Employer-Provided Childcare Credit
The employer-provided childcare credit of 25% of qualified childcare facility costs has increased to 40% and, in some cases, to 50% for eligible small businesses. Additionally, the credit limitation of $150K has increased to $500K and, in some cases, to $600K for eligible small businesses.
A Midwest manufacturing firm that chooses to operate a licensed on-site childcare facility open to all its employees’ children can expect increased tax savings.
Charitable Contribution Limits (Corp.)
Corporations’ charitable contributions must exceed 1% of their taxable income for the year to qualify for a deduction. The ceiling remains at 10% of taxable income. Excess contributions can be carried forward for 5 years.
A corporation that previously allocated 0.5% to charitable giving must increase its allocation or forfeit the deduction.
Estate & Gift Tax Exemption Amount
Starting in 2026, the exemption jumps to $15M per person ($30M per couple), indexed for inflation.
A business founder nearing retirement should revisit trusts and gifting strategies to lock in higher exemption thresholds today.
Why Estate Planning Still Matters—Even with Higher Exemptions
- Avoiding “Use-It-or-Lose-It” Pressures: Although exemption amounts rise to $15M in 2026 and are permanent, existing estate plans created under lower thresholds could produce unintended tax outcomes.
- Protecting Against Political Change: Despite being labeled permanent, future legislatures could reinstate lower limits—or reshape them entirely. Plans should include flexibility and protective provisions.
- Focusing on Values—not just Dollars: This is a rare window for meaningful legacy planning. Business owners can align estate strategies with their values—such as philanthropy, governance, or family transition—while optimizing tax efficiency.
- State-Level Tax Exposure: Remember: States can impose their own estate or inheritance taxes. A $30M federal exemption doesn’t always shield you at the state level.
What CEOs Should Do Now
- Reassess Tax Strategy: Update your projections using permanent QBI deductions, increased Employer-Provided Childcare Credit limitations, and updated Charitable Giving rules.
- Make Capital Moves: Accelerate equipment purchases or R&D spend now to maximize write-offs.
- Enhance Employee Benefits: Use tip and overtime deductions as recruiting tools—then promote them internally.
- Update Estate, Gift & Legacy Plans: Work with counsel to ensure documents align with new exemption levels, portability rules, and personal wishes.
No matter the change, strategy — not reaction — wins. At Goosmann Law Firm, we help translate sweeping legislation into practical tools: stronger planning, clearer legacies, and more capable businesses.