What the “Big Beautiful Bill” Means for Your Business: Key Tax Changes and How to Respond

On July 4, 2025, the One Big Beautiful Bill Act (OBBBA) was signed into law—marking one of the most significant shifts in federal tax policy since 2017. While headlines touted big promises, what matters most is how these changes affect real businesses and real decision-making. At Fine Point Consulting, we’ve been analyzing the details and translating them into actionable strategies for our clients.

Here’s a breakdown of what you need to know—and how we’re helping clients take advantage of the new landscape.

1. R&D Tax Relief Returns

One of the biggest wins for startups and innovation-focused companies: the so-called “Innovation Tax” has been reversed. Domestic R&D costs are now fully deductible beginning in 2025, instead of being amortized over five years.

But there’s more. For small businesses with less than $31M in gross receipts, this change can apply retroactively to the 2022 tax year. Businesses that previously capitalized domestic research and experimentation (R&E) costs starting in 2022 now have options:

• Amend past returns to reclaim taxes already paid
• Elect to accelerate remaining deductions starting after December 31, 2024

How Fine Point is Helping: At Fine Point, we’re prioritizing this change because of how significantly it affects our startup clients—many of whom felt the financial strain of losing immediate R&D deductibility in recent years. Our tax team is reviewing past filings and working one-on-one with clients to determine the best course of action: amend or accelerate. We’ll help evaluate timelines, financial impacts, and compliance requirements to ensure each decision is customized and strategic.

And while domestic R&D gets a big win, keep in mind: foreign R&D expenses must still be amortized over 15 years.

2. Bonus Depreciation and Expensing—More Room to Invest

The OBBBA permanently extends 100% bonus depreciation for qualified property placed in service after January 19, 2025. Additionally, Section 179 expensing limits increased to $2.5 million for purchases made after December 31, 2024.

This opens the door for businesses to:

• Accelerate capital equipment purchases
• Offset income with larger up-front deductions
• Strategically time asset acquisitions for maximum benefit

We’re helping clients assess how these provisions can support growth or modernization plans—especially where equipment or software investments are on the horizon.

3. Section 1202 – Capital Gains Relief for Startups

The OBBBA significantly enhances incentives for investing in early-stage and growth companies by expanding the benefits under Section 1202—also known as Qualified Small Business Stock (QSBS) exclusion.

Here’s how the new structure works for QSBS acquired after the bill’s enactment:

• 50% exclusion on capital gains if held 3 years or more
• 75% exclusion if held 4 years or more
• 100% exclusion if held 5 years or more

This change makes equity in qualified small businesses an even more attractive investment—especially for founders, early employees, and angel investors. It also rewards longer holding periods with greater tax savings.

What this means for our clients: Startups may find it easier to attract and retain investors who are motivated by these enhanced tax benefits. Founders and employees with QSBS stock should revisit their long-term equity strategy and documentation to ensure they meet eligibility requirements.

Fine Point is working with clients to:

• Review entity structure and stock issuance practices
• Confirm QSBS eligibility under the updated rules
• Plan for exit events and timing to maximize gain exclusions

4. Other Key Provisions to Watch

• 1099 Reporting Thresholds: Raised from $600 to $2,000 starting in 2025.
• Business Interest Deduction: Reverts to a more favorable EBITDA-based limitation.
• Charitable Deductions for C-Corps: Now only deductible to the extent they exceed 1% of taxable income, capped at 10%.
• ERTC Refunds Barred: No refunds will be issued for certain 2021 claims filed after Jan. 31, 2024.
• Advanced Manufacturing Credit: CHIPS Act credit increased to 35% for applicable property after Dec. 31, 2025.

How Fine Point Is Helping

We know this is a lot to digest—and naturally, you may be wondering how it applies to your business. Our team is already zeroing in on one of the bill’s most impactful areas: the R&D deduction changes.

Fine Point will be reaching out directly to clients who may benefit from the new options around Research & Experimentation expenses. Our tax team is also continuing to brief our internal team so that our controllers—who know our clients best—can help flag opportunities as they come up.

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Have questions about how the new rules apply to you? Don’t hesitate to reach out. We’re here to help you make confident, informed decisions in the wake of these changes.

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