Are You Missing These 5 Game-Changing Tax Benefits from the One Big Beautiful Bill Act?

If you've been too busy running your business to keep up with tax law changes, you might be leaving serious money on the table. The One Big Beautiful Bill Act (OBBBA), signed into law in July 2025, delivered some of the biggest tax breaks we've seen in years, and they're effective right now for the 2025 tax year.

With December winding down, this is your last chance to maximize these benefits before you file. Let me walk you through the five game-changers that could seriously impact your bottom line.

1. No More Taxes on Tips and Overtime (Yes, Really!)

This one's huge for service-based businesses and anyone working extra hours. Starting January 1, 2025, tips and overtime pay are completely exempt from federal income tax.

For business owners: If you're in restaurants, hospitality, or any tip-heavy industry, your employees just got a massive pay bump without it costing you a dime. This also applies to business owners who work overtime in their own companies.

December action item: Review your payroll records to identify any tips or overtime that was already taxed this year. You might be due for refunds when you file.

2. Bigger Standard Deduction = More Money in Your Pocket

The standard deduction got a permanent boost that puts more cash back in your business account:

• Single filers: $15,750 (up from $14,600)

• Married filing jointly: $31,500 (up from $29,200)

• Head of household: $23,625 (up from $21,900)

Why this matters for small business owners: If you're a sole proprietor, LLC, or S-Corp owner taking distributions, this larger deduction means less of your business income gets taxed at the personal level.

December strategy: If you were planning to itemize deductions but your total is close to these new standard amounts, you might be better off taking the standard deduction and saving yourself the paperwork headache.

3. The Senior Bonus: Extra $6,000 Deduction for 65+

Business owners 65 and older just hit the jackpot. You can now claim an additional $6,000 deduction on top of your standard or itemized deductions through 2028.

The catch: This bonus phases out if your modified adjusted gross income exceeds $150,000 ($300,000 for married couples). The annual cap is $12,500 for single filers and $25,000 for joint filers.

Smart December move: If you're close to the income threshold, consider deferring some income to 2026 or accelerating deductible expenses to stay under the limit.

4. Enhanced Child Tax Credit: From $2,000 to $2,200

Small business owners with kids get a permanent $200 boost per child, plus the credit is now indexed to inflation. The refundable portion stays at $1,400, and the phase-out thresholds are $200,000 for single filers and $400,000 for married couples.

Business owner bonus: If your business had a great year and pushed you over the old phase-out limits, the higher thresholds might bring you back into eligibility.

December consideration: If you're an S-Corp owner, timing your salary vs. distribution split could help you stay under the phase-out thresholds while maximizing this credit.

5. SALT Deduction Relief: $40,000 Cap (Four Times Higher!)

This is the big one for business owners in high-tax states. The cap on state and local tax deductions jumped from $10,000 to $40,000 for 2025-2029.

Who benefits most: If you're in states like California, New York, New Jersey, or Connecticut, this could save you thousands. The benefit phases out for modified AGI between $500,000-$600,000.

December strategy: If you were holding off on paying property taxes or state estimated taxes, paying them before December 31st could maximize your SALT deduction.

What This Means for Your December Planning

These changes aren't just nice-to-know information: they require action before December 31st to maximize your benefits:

For tip-based businesses: Calculate how much you've already paid in taxes on tips this year. You'll likely get refunds when you file, but you can adjust withholdings now to improve cash flow.

For all business owners: Review your income projections for December. If you're close to any phase-out thresholds, consider:

• Deferring invoicing to January 2026

• Accelerating equipment purchases or other deductible expenses

• Maximizing retirement plan contributions

For seniors: If you're 65+ and haven't factored in the $6,000 bonus deduction, recalculate your tax estimates. You might owe less than you think.

For parents: The enhanced Child Tax Credit might change whether itemizing makes sense. Run the numbers both ways.

Don't Let These Benefits Slip Away

The One Big Beautiful Bill Act represents the largest working-class tax relief since 2017, with $191 billion in new tax cuts. But benefits only help if you actually claim them.

With just weeks left in 2025, now's the time to review your situation and make any last-minute moves. If you're feeling overwhelmed by the complexity, remember that getting professional help now could save you far more than it costs.

Your business worked hard this year: make sure you're not overpaying taxes because you missed these game-changing benefits.

Ready to maximize your tax savings? Don't wait until April to discover what you could have done differently. Contact us for a year-end tax planning consultation and make sure you're capturing every benefit available to your business.

Need help getting your books ready for tax season? Check out our bookkeeping catch-up services to ensure your records are accurate and complete before filing.