Published
September 12, 2025
The new tax law, commonly known as the One Big Beautiful Bill Act, is a game-changer for Main Street small businesses. The pro-growth provisions in the law signed by President Donald J. Trump in July are immediate and double the deduction for new equipment and capital purchases from $1.25 million to $2.5 million for this year. Additionally, the new tax law allows for 100% bonus depreciation, a major reversal of the phase out that was planned over the next several years. Finally, the restoration of immediate expensing for research and development (R&D) is a major boost, especially for small American manufacturers whose hands were tied by amortization rules required over the past 3-years.
Even after this year, the One Big Beautiful Bill Act will continue to help small businesses because Congress made the 20% small business deduction and these changes permanent. Permanency provides the clarity and stability businesses need to plan confidently for the future, ensuring they can reinvest in their workforce, expand operations, and drive economic growth.
Unleashing Growth Through R&D Expensing
The 2025 law’s restoration of immediate expensing for U.S.-based R&D costs stands as a major victory for American innovation.
As Natalie Kaddas, CEO of Kaddas Enterprises in Utah, explains: re-instatement of immediate R&D expensing lifts a punishing tax burden that stifled investment for the past three years when companies were forced to amortize R&D costs—tying up much-needed capital. Kaddas Enterprises faced a 35% effective tax hike for each year they were forced to amortize R&D instead of expensing it immediately. Now, freed from this drag on cash flow, small firms can invest in operational upgrades and energy-resiliency efforts, fueling progress that benefits local communities and the national economy.
Victoria Thomas, President of VICCI Inc., echoes this sentiment from Wisconsin’s motorsports industry. By allowing business owners to amend tax returns for refunds on previously amortized R&D, her team is unlocking more than six figures to grow, hire, and innovate. It’s not simply about balance sheets; it’s direct evidence that the tax change incentivizes American manufacturing and supports Thomas’s strategic partners like Riley Technologies, which is already experiencing a surge in custom, high-performance car orders for 2026.
Making Productivity Investments Possible
The new tax law’s impact isn’t limited to research—it also directly addresses capital investment and productivity.
Traci Tapani, co-owner of Wyoming Machine in Minnesota, provides an example of how the law’s 100% bonus depreciation for new equipment creates opportunity and reduces risk. Before this reform, smaller manufacturers could deduct only 40% of the cost of major technology purchases in the first year and 20% in the second. The new rules allow full deduction up front, whether investing in cutting-edge fiber optic laser welding or other advanced tools.
For Tapani, the purchase of a new fiber optic laser welding machine, enabled by passage of the One Big Beautiful Bill Act, not only boosts productivity but also addresses chronic shortages in highly trained welders. Fiber optic welding is easier to use and less damaging to materials, allowing Wyoming Machine to serve a wider array of customers and industries.
Clarity and Confidence for Growth
Perhaps the most underrated gift of the One Big Beautiful Bill Act is confidence—clear, permanent rules that help business owners plan for the future.
As Mike Zaffaroni of Liberty Landscape Supply in Jacksonville, Florida, explains, uncertainties over whether a small business deduction for sole proprietors, partnerships, and S corporations would be extended beyond the end of this year made long-term decisions difficult. The new tax law made that 20% small business deduction permanent and put an end to this anxiety. The permanent restoration of 100% bonus depreciation and the deduction for R&D costs are also helping Zaffaroni turn wish-list projects into business realities—like a $100,000 upgrade in enterprise software, truck purchases, and new hires to meet customer demand.
When small businesses can plan ahead, they invest, expand, and hire. That ripple effect strengthens communities and helps secure America’s economic leadership.
Tom Sullivan is Senior Vice President for Small Business Policy at the U.S. Chamber of Commerce. Natalie Kaddas, Victoria Thomas, Traci Tapani, and Mike Zaffaroni are leaders on the Chamber’s Small Business Council.
Share your story on how the new tax law is helping your small business grow by clicking here.
Dig Deeper
About the author
Thomas M. Sullivan
Thomas M. Sullivan is senior vice president of small business policy at the U.S. Chamber of Commerce. Working with chambers of commerce and the U.S. Chamber’s nationwide network, Sullivan harnesses the views of small businesses and translates that grassroots power into federal policies that bolster free enterprise and reward entrepreneurship. He runs the U.S.
