On July 4, 2025, President Trump’s One Big Beautiful Bill Act (OBBB) was signed into law. This sweeping legislation includes major tax reform provisions that will have far-reaching implications for small businesses in the years to come.
In this Small Business Update, Neil Bradley, EVP, Chief Policy Officer, and Head of Strategic Advocacy at the U.S. Chamber of Commerce, joined CO— Editor in Chief Jeanette Mulvey to unpack the OBBB and what it means for small business owners. Bradley also provided updates on tariffs, immigration, and policy priorities that could impact entrepreneurs across the country.
Here are the biggest takeaways from the conversation.
Business-friendly tax provisions from the Tax Cuts and Jobs Act are now permanent
One of the biggest impacts of the OBBB is that it will make several key provisions from the 2017 Tax Cuts and Jobs Act (TCJA) permanent. These policies, which offered extensive relief for many small businesses, were set to expire at the end of 2025, which means the “tax cliff” many had feared will be avoided.
Now-permanent tax provisions under the OBBB include:
20% qualified business income (QBI) deduction for pass-through businesses (LLCs and S Corps).
100% bonus depreciation for new capital investments.
Increased interest deductibility limits.
Immediate R&D expensing, retroactive to January 2022 for businesses with less than $31 million in gross receipts.
Bradley also highlighted the increased SALT (state and local tax) deduction on federal tax returns, from $10,000 to $40,000 per year.
“For those with income of less than half a million dollars a year, … you'll have an expanded ability for the next several years to claim a bigger deduction for the taxes that you pay [to] state and local [entities],” said Bradley. “That's good news in terms of your ability to deduct taxes associated with your business.”
[Read more: Tax Season Planning You Should Be Doing Now]
New and expanded tax credits help businesses support employees
The enhanced employer benefits and incentives introduced with the OBBB make it easier and more advantageous to provide paid leave and other benefits to employees. Bradley highlighted the following new and expanded tax credits from the Act:
Paid leave tax credit. The paid leave tax credit is now permanent and available even in states with mandatory paid leave. It can also be applied to employer-paid insurance premiums.
Childcare expense credit. Small businesses can now claim up to 50% (previously 40%) of the cost of offering on-site or off-site childcare for employees. Now, they can also pool together with other local businesses to access tax credits for shared childcare services.
Student loan repayment benefit. Under this now-permanent benefit, employers can contribute up to $5,250 toward employees’ student loans tax-free.
Taking advantage of these tax credits can help you expand your benefits offerings, which can ultimately help you attract and retain employees in an already-tight labor market.
[Read more: Employee Benefits Tax Deductions: Guide for Business Owners]
Rising tariffs will hit small businesses hard
While the OBBB will have an overall positive impact on small businesses, tariffs will continue to put a strain on their finances. The previously established 90-day “pause” on President Trump’s reciprocal tariffs ended on July 8, and a wave of new tariffs is set to take effect on August 1. This includes country-specific tariffs (e.g. 50% for countries like Brazil and Mexico on non-USMCA goods) and product-specific tariffs of up to 50% on goods like EVs, semiconductors, steel, aluminum, and pharmaceuticals.
About 242,000 small businesses import goods each year, said Bradley, and many are already struggling with rising costs and uncertainty.
“Over the next six months, tariffs are likely to go up, not down,” he added.
Immigration changes could make labor shortages worse
While millions of workers currently have valid U.S. work authorizations, the Trump administration is beginning to rescind some of these, including parole-based work authorizations and temporary protected status for certain countries, including Venezuela. This could affect millions of legally working individuals across industries like hospitality, agriculture, and construction—and employers may not even know if their employees’ work authorization has been rescinded early.
“The conundrum … for employers is that you currently have no way of knowing that other than your employee telling you,” said Bradley. “And if they don't inform you, then you might not know what the consequences are for continuing to employ that person.”
Watch the full Small Business Update in the video above for Bradley’s advice to small business owners, and don’t forget to apply to the 2025 CO— 100 by July 25!