The One Big Beautiful Bill creates unique opportunities for business owners to coordinate personal tax benefits with business strategy. With most provisions expiring in 2028, strategic planning now can capture significant value during the four-year window.
Personal Tax Benefits That Affect Business Planning
Senior Deduction (Ages 65+)
- $6,000 deduction per person ($12,000 for couples filing jointly)
- Phases out at $75,000/$150,000 MAGI
- Available 2025–2028; stacks with standard deduction and 65+ add-on
Vehicle Loan Interest Deduction
- Up to $10,000/year for new, U.S.-assembled personal vehicles
- Phases out at $100,000/$200,000 MAGI; leases don’t qualify
- Available 2025–2028
Overtime and Tip Deductions
- Overtime: Deduct up to $12,500/$25,000 of FLSA premium pay
- Tips: Deduct up to $25,000 in properly reported voluntary tips (cash and card only)
- Phases out at $150,000/$300,000 MAGI; available 2025–2028
Trump Accounts (Starting July 4, 2026)
- Employer contributions up to $2,500/year to employee or dependent child accounts
- Contributions excluded from wages; count toward $5,000 annual limit
Permanent vs. Temporary
- Permanent: Increased standard deduction, updated tax rate schedule, 100% bonus depreciation for property acquired on/after Jan 19, 2025
- Temporary: Senior deduction, vehicle interest deduction, overtime/tip deductions, Trump Accounts
Strategic Planning Considerations
Year 1 (2025):
- Implement employee benefit communications
- Optimize personal deductions available
- Plan major purchases and income timing
Years 2-3 (2026-2027):
- Trump Account strategies available (starting July 2026)
- Peak benefit optimization years
- Business and personal coordination
Year 4 (2028):
- Final year for most benefits
- Preparation for benefit expiration
- Transition planning for post-2028
Entity Structure Considerations
S-Corporation Optimization
Owner compensation strategies:
- Balance salary vs. distributions considering personal deduction benefits.
- Coordinate with spouse employment for optimal household benefits.
- Plan for benefit expiration in compensation structure.
Partnership Considerations
Multi-owner coordination:
- Individual partner benefit timing may vary based on age and circumstances.
- Entity-level decisions affecting individual partner benefits.
- Buy-sell agreement implications of temporary tax benefits.
LLC Planning
Pass-through entity optimization:
- Income timing flexibility for optimal personal benefit capture
- Coordination with member personal tax situations
- Planning for benefit expiration in operating agreements
Cash Flow and Investment Planning
Equipment Purchase Timing
Coordinate business needs with personal benefits:
- Section 179 and bonus depreciation for business equipment
- Personal vehicle interest deductions for qualifying purchases
- Cash flow optimization during benefit years
Business Investment Strategies
Enhanced cash flow from personal tax savings:
- Reinvestment opportunities in business growth
- Working capital strategies during benefit year
- Debt paydown vs. investment decisions affected by personal tax savings
Family Business Succession Planning
Timing Business Transitions
Consider benefit expiration in succession planning:
- Accelerate transitions to capture temporary benefits
- Coordinate with Trump Account opportunities for next generation
- Estate planning integration with temporary tax benefits
Multi-Generational Benefits
Coordinate across generations:
- Senior deductions for retiring generation
- Trump Account contributions for grandchildren (starting 2026)
- Business succession timing to maximize family benefits
Professional Service Firms
Partnership Buy-Ins and Buy-Outs
Strategic timing considerations:
- Personal deduction benefits affecting individual partners
- Financing vs. cash decisions during benefit years
- Succession planning acceleration to capture temporary benefits
Employee Benefit Communication
For professional service employees:
- Overtime benefits for non-exempt staff
- Trump Account employer contributions as unique benefit
- Competitive advantage in professional services hiring
Industry-Specific Strategies
Manufacturing
- Coordinate equipment purchases with personal vehicle timing
- Employee overtime benefit communications
- Cash flow planning with enhanced personal deductions
Professional Services
- Partnership planning around individual partner benefits
- Employee benefit competitive advantages
- Business transition timing optimization
Retail and Hospitality
- Service employee benefit communications
- Seasonal planning coordination with personal benefits
- Equipment and renovation timing
Action Steps for Business Owners
Immediate Assessment (2025)
- Calculate your personal benefit eligibility across all categories.
- Assess business implications of personal tax savings.
- Review entity structure optimization opportunities.
- Plan major purchase timing for 2025-2028 window.
Strategic Planning (2026-2028)
- Develop multi-year coordination strategies.
- Implement Trump Account employer contribution programs (if applicable).
- Optimize business and personal tax planning integration.
- Prepare transition plans for post-2028.
Long-term Coordination
- Integrate with existing succession planning.
- Coordinate with estate and wealth management strategies.
- Plan for benefit expiration and return to traditional planning.
- Monitor changing tax law for additional opportunities.
Why Professional Guidance Is Essential
- Complexity multiplication: Business owners face more complex interactions between new and existing tax provisions.
- Coordination requirements: Success requires integrating temporary benefits with ongoing business operations and long-term planning.
- Opportunity cost of delay: The temporary nature means missed opportunities cannot be recovered after 2028.
Ready to coordinate business and personal benefits strategically? Contact us for comprehensive analysis of how these new provisions integrate with your business planning and personal tax strategy.
