Key Takeaways for OBBBA
- 100% bonus depreciation is back—but binding contract dates matter.
- SALT deduction raised to $40K for many filers, with PTE elections still in play.
- R&D expensing restored—consider amending 2022–2024 or accelerating into 2025.
- Charitable and estate “permanent” rules offer new long-term planning opportunities.
- Energy and solar credits expire 12/31/2025—act fast if you plan to install.
Your 2025 Tax Strategy Window Is Closing Fast
With just weeks left in the year, business owners and high-net-worth families are looking at one of the most pivotal year-ends in recent memory. The One Big Beautiful Bill Act (OBBBA) reshaped key areas of the tax code—bringing back full bonus depreciation, expanding SALT deductions, restoring R&D expensing, and locking in several “permanent” provisions for business owners.
But “permanent” doesn’t mean unchangeable. A proactive strategy in November and December can make the difference between saving thousands in 2025 or paying more than necessary in 2026.
1. Bonus and §179 Depreciation: Time Your Purchases
The return of 100% bonus depreciation is great news, but it comes with a twist: the binding contract rule.
- Equipment under a binding contract before January 20, 2025 doesn’t qualify for 100% bonus—even if placed in service later.
- Use Section 179 to control your final taxable income (especially with the 80% NOL limit).
Quick tip: Review asset additions made early in 2025 to ensure they qualify—or adjust year-end purchases strategically.
2. SALT & PTE: Coordinate for Maximum Benefit
The SALT deduction cap increase to $40,000 (phased out at higher AGI levels) means pass-through owners should revisit their PTE elections.
- Analyze whether it’s more beneficial to take the PTE deduction at the entity level or rely on itemized deductions.
- Consider prepaying April property taxes in December to boost deductions under the higher SALT cap.
Action item: Run a projection with your CPA to test both scenarios before December 31.
3. R&D Expenses: Decide on Amending or Accelerating
After three years of amortization headaches, R&D expenses are fully deductible again starting in 2025.
If your business had R&D costs between 2022–2024:
- Under $31M in receipts? You can amend prior-year returns to reclaim those deductions.
- Over $31M? You can accelerate remaining amortized costs into 2025–2026.
Deadline alert: The window to finalize your election closes July 6, 2026—but planning starts now.
4. Estate and Charitable Moves: “Permanent” but Not Guaranteed
The new $15M individual / $30M joint estate exemption offers unprecedented flexibility—but history shows that “permanent” only lasts until Congress changes course.
- Review prior gifting strategies to make sure they still make sense.
- Consider donor-advised funds or qualified charitable distributions (QCDs) to front-load deductions before 2026’s new limits.
- Talk to your estate attorney about updating trusts to optimize basis and income-tax outcomes rather than just reducing estate size.
5. Energy Credits: The Clock Is Ticking
The 30% solar and battery storage credits end on December 31, 2025—projects must be placed in service by year-end.
- Expect contractor bottlenecks in Q4—schedule installations early.
- EV charger credits remain open until June 30, 2026 (residential and commercial).
If you’ve been on the fence about solar or battery upgrades, 2025 is your year to act.
6. California Considerations
California continues to chart its own course:
- Still limits §179 to $25,000 and does not allow bonus depreciation.
- NOL suspension applies 2024–2026 if taxable income exceeds $1M.
- R&D remains expensable—no amortization required.
Tip: For California businesses nearing the $1M mark, consider timing bonuses, capital projects, or prepaids to reduce taxable income before year-end.
7. The “Action Before Filing” Rule
By February or March, your ability to influence 2025 taxes is gone. The most effective planning happens before December 31—when purchases can still be made, payroll bonuses timed, or deductions accelerated.
This is the time to:
- Review projected taxable income and entity structure.
- Update cash flow forecasts based on bonus/R&D timing.
- Schedule a year-end planning session with your advisor.
The Bottom Line
2025 isn’t just another tax year—it’s the foundation for your next decade of financial strategy. Between the restored deductions, new limits, and looming deadlines, there’s a narrow window to make impactful moves that shape your business’s 2026 outlook and beyond.
Don’t wait until tax season. Plan now. Contact us today!
