On July 4, 2025, President Donald Trump signed into law legislation (H.R.1), known as the One Big Beautiful Bill Act (the “Act”). The legislation was passed through the budget reconciliation process and cements many of the individual and business tax provisions that were originally established under the 2017 Tax Cuts and Jobs Act (“2017 TCJA”) which were set to sunset in 2025. The Act also adds several new provisions that were promised during the 2024 Trump campaign. This is the first alert in our series examining key provisions of the Act, with this article focusing on tax provisions impacting businesses.

The following are some of the key business tax provisions:

Depreciation Deduction
The Act makes permanent the full first-year bonus depreciation for certain qualified property, a provision first introduced in the 2017 TCJA, provided the property is placed into service after January 19, 2025. Qualified property is defined as property subject to the Accelerated Cost Recovery System depreciation rules with a useful life of 20 years or less, certain computer software, and certain leasehold improvements.

Expensing of Qualified Production Property
Qualified Production Property is nonresidential real property used for certain activities such as manufacturing or refining but does not include space used for other purposes related to the business, such as administrative, sales, or research and development functions. The Act permits the full expensing of Qualified Production Property where: 

1. the construction begins on or after January 20, 2025 and before January 1, 2029, 
2. the property is placed into service before January 1, 2031, 
3. the property is integral to the production activity, and 
4. the property’s initial use originates with the taxpayer.

Research and Experimental Expenditures

• Immediate Expensing of Domestic R&E Expenditures – New Section 174 allows taxpayers to fully deduct domestic research or experimental expenditures in the year they are paid or incurred, provided they are connected with the taxpayer’s trade or business. Previously, under the TCJA taxpayers had to capitalize and amortize R&E expenditures over five years.
• Option to Amortize Domestic R&E Expenditures – Taxpayers can elect to amortize domestic R&E expenditures over a period of not less than 60 months. The election must be made by the return due date for the year the costs were paid.

Software Development Costs
Expenditures related to software development are now explicitly treated as R&E expenditures and eligible for immediate expensing under new Section 174A if performed domestically.  

If you have questions about how your business can take advantage of these tax provisions, please reach out to attorney Kevin Scott or any member of Barley Snyder’s Business or Tax practice groups. Be on the lookout for the next alert in our series covering key tax provisions of the Act affecting individuals.