Smarter Taxes, Bigger Moves: What the OBBBA Means for You in 2025

The One Big Beautiful Bill Act (OBBBA) is shaking up the tax landscape for entrepreneurs, investors, and business owners—with new write-offs, expanded deductions, and fresh planning opportunities you don’t want to miss. Whether you're buying equipment, scaling a startup, or just commuting in a new US-made car, this year’s updates could mean thousands in tax savings. Below, we’ve broken down the 6 most powerful changes—and how to act on them before they pass you by.

Focus: 6 Key Tax Opportunities for Entrepreneurs and Business Owners

Quick Comparison: Old Law vs. OBBBA

Provision 2024 (Prior Law) 2025 Onward (OBBBA) Effective
Bonus Depreciation 60% in 2024 → 40% in 2025, then phased out 100% restored and made permanent After Jan 19, 2025
Section 179 Expensing Max $1.22M, phaseout at $3.05M Increased to $2.5M limit; phaseout at $4M Jan 1, 2025
Opportunity Stock for Business Startups (“OSBS”) $10M gain exclusion, 100% at 5 years Up to $15M exclusion, tiered gains start at 3 yrs After July 4, 2025
Pass-Through Deduction for partnerships, LLCs, S corps 20% deduction, expiring 2026 Raised to 23%, made permanent Jan 1, 2026
Employer-Provided Meals 50% deductible Fully disallowed starting 2026 Ends Dec 31, 2025
Auto Loan Interest No deduction for personal auto interest Up to $10,000/year deductible 2025–2028

1. Bonus Depreciation (100% Immediate Write-Off)

Full write-off restored permanently for qualified property (generally property with 20 years or fewer recovery life, such as equipment, machinery, and vehicles).

Planning Tips:

  • Accelerate equipment and asset purchases post–Jan 19, 2025.
  • For mixed-use vehicles (e.g., personal and business), consider using 100% bonus depreciation + auto interest deduction >>> pro-rata 100% depreciation for business use + pro-rata share of interest (up to $10K/year, subject to phaseout).

2. Section 179 Expensing (Now $2.5M Limit for more Immediate Write-Off)

A higher threshold gives flexibility to spend even more on asset investments.

Planning Tips:

  • Stack with Bonus Depreciation (100% Immediate Write-Off) for max first-year write-offs.

3. Tax Free Capital Gain on Original Issued Shares for PEs and Investors

Tiered capital gains exclusions for original issued US C corporation shares (e.g., exchange for cash, property (non-stock) or service) with gross asset value under $75 million:
- 50% after 3 years
- 75% after 4 years
- 100% after 5 years
Exclusion cap raised from $10M to $15M.Planning Tips:

  • Structure investments to qualify under Qualified Small Business Stock.
  • Strategize the aggregation rule for majority-owned foreign businesses for 80% active business qualifications.
  • For founders and early employees, consider issuing stock before hitting $75 million asset limit, exercising ISOs, SAFEs early to start holding period, and holding stock for at least 3–5 years to benefit from tiered exclusions.
  • Other strategies such as QSBS stacking, gifting, and rollover for the max exclusion and timing flexibility.

4. Pass-Through Deduction for S Corp, LLCs, and Sole Proprietors (Increased from 20% to 23%)

Section 199A is permanent and more generous.

Planning Tips:

  • Consider converting sole proprietorships to S-Corps or partnerships (save payroll taxes and ability to issue W-2s to themselves).
  • Aggregate businesses to maximize thresholds.
  • Businesses with W-2s and tangible property may consider maximizing W-2s and tangible property to increase the QBI deduction.
  • Watch out for service-based business >> higher thresholds on QBI phaseout.
  • Timing the retirement contribution to increase QBI qualifying income.

5. Employer-Provided Meals Deduction Ends in 2026

Only limited exceptions in the fishing and food industries. Client meals and employee travel meals remain 50% deductible.

Type of Meal 2025 Deduction 2026 Deduction
Client meals 50% 50%
Office snacks & lunches 50% 0%
On-premise meals for convenience (e.g., overtime meals) 50% 0%
Employee travel meals 50% 50%


Planning Tips:

  • Maximize deductions in 2025.
  • Shift to stipends or reimbursements. Note, employers can deduct taxable meal stipends to employees. On the other hand, employer cannot deduct tax free meal reimbursements to employees.

6. Auto Loan Interest Deduction

Deduct up to $10K/year interest on personal-use, U.S.-built vehicles.

Criteria Requirement
Use Vehicle must be for personal use (commuting, errands, etc.)
Assembly Vehicle must be assembled in the U.S. (verify via VIN)
Loan Interest must be on a qualified auto loan (secured, not lease)
Timing Loan must originate between 1/1/2025–12/31/2028
Filing Deduction available whether you itemize or not
Filing Status Phaseout Begins Fully Phased Out
Single $100,000 $120,000
Married Filing Jointly $200,000 $240,000

Planning Tips:

  • Purchase vehicles before Dec 31, 2028. Time the loan repayments.
  • Confirm US assembly via VIN.
  • Watch AGI phaseouts $100K for single taxpayers and $200K for married taxpayers.
  • Not for business vehicles.

Wrapping Up: Turn Tax Changes Into Strategic Wins

The OBBBA brings a rare mix of expanded deductions, permanent perks, and looming phaseouts—all of which create a window for powerful tax planning. The most successful business owners won’t wait until year-end to act—they’ll use this midyear insight to fine-tune purchases, entity structures, stock strategies, and deductions now.

Next Steps:

Meet with your tax advisor to tailor these strategies to your business goals and income plan. With the right moves, 2025 could be your most tax-efficient year yet.