If you’ve been hearing about the One Big Beautiful Bill Act (OBBBA) but aren’t quite sure what it means for you, you’re not alone. Signed into law in 2025, OBBBA is one of the most sweeping pieces of federal tax legislation in nearly a decade, and some of its most significant provisions are already affecting returns and will continue phasing in through 2027 and beyond.
Here’s a plain-language look at a few of the changes worth understanding as you plan for year-end and beyond.
Bonus Depreciation Is Back, Permanently
One of the biggest wins for business owners is the restoration of 100% bonus depreciation for qualified property. If you’re planning to purchase equipment, machinery, or a business vehicle, this change could make a real difference in how much of that purchase you can deduct in the year you buy it, rather than spreading it out over several years.
Higher Deduction for State and Local Taxes (SALT)
The cap on how much you can deduct for state and local taxes has increased significantly for many filers, with additional increases scheduled through 2029 before it’s set to revert. If you itemize deductions, this is worth a closer look, especially if you live in a higher-tax state like Connecticut.
Changes to Charitable Giving Deductions
OBBBA reshapes how charitable contributions are deducted. Taxpayers who don’t itemize can now claim a deduction for cash donations, a benefit that wasn’t previously available. At the same time, those who do itemize will see a new floor applied to their charitable deductions, meaning a small portion of contributions may no longer be deductible. If giving is part of your year-end financial planning, this is an important shift to understand.
A Permanent Home for the Qualified Business Income (QBI) Deduction
For business owners, the 20% QBI deduction is now permanent, with adjusted thresholds that may make it more accessible depending on your business structure and income level.
Why the Details Matter
Every one of these provisions comes with its own thresholds, phase-in schedules, and exceptions. What applies to one business or individual may look completely different for another, which is exactly why a blanket summary can only take you so far.
Our team is closely monitoring IRS and Treasury guidance as it continues to be issued, so you don’t have to track every update yourself. If you’re wondering how OBBBA might affect your specific situation, whether it’s a real estate transaction, a business decision, or your personal filing, reach out to our office. We’re happy to walk through what it means for you.
Want the full breakdown? Keep an eye out for our Fall Newsletter, coming soon, where we’ll dig deeper into OBBBA and everything else you need to know heading into year-end.
