A major tax update was recently signed into law, and it could have a significant impact on business finances. The One Big Beautiful Bill Act (OBBBA), passed on July 4, 2025, introduced a standout provision: permanent 100% bonus depreciation. For businesses planning to purchase new equipment, vehicles, or make improvements, this change could be a game‑changer. Below, we’ll walk through what’s changed and how your business can benefit.

What’s New Under the OBBBA?

With the passage of the OBBBA, businesses now have access to full and immediate depreciation for many commonly purchased assets. This creates an opportunity to reduce taxes upfront and put more capital back into your operations.

Key Changes to Bonus Depreciation

Here are the major updates business owners should know—explained in simple terms and arranged in a fresh, randomized order:

• Taking full depreciation upfront reduces taxes in the year of purchase and increases available working capital.
• This bonus depreciation rule is now permanent, reversing the prior phase‑down schedule (previously 40% for 2025).
• Businesses have more flexibility to time purchases based on operational needs and tax strategy.
• Businesses can now deduct 100% of the cost of qualifying assets placed in service starting January 20, 2025.
• Accelerated deductions can improve cash flow and free up funds for reinvestment in areas like staffing, system upgrades, or expansions.
• Qualifying assets include equipment, machinery with a useful life of 20 years or less, qualified improvement property, computer software, and certain business vehicles (with weight and use caveats).
• Bonus depreciation allows businesses to deduct the full cost of eligible assets—like computers, furniture, or building improvements—in the year they’re placed in service.
• Not all states may conform to this federal provision, so it’s important to check local tax rules.

How Businesses Can Use This

The new rules open the door to a wide range of strategic purchasing opportunities. A company upgrading its software systems could now deduct the full cost in the year the upgrades go live. A construction firm investing in a fleet of heavy‑duty vehicles may find the upfront tax savings substantial. Even office improvements—like replacing old fixtures or expanding workspace—can fall under these rules depending on the asset type.

Because every business is different, consulting a tax professional before making major decisions is essential. They can help you understand eligibility, timing, and how this deduction fits into your overall tax strategy.

A Strong Opportunity for Growth

The OBBBA’s bonus depreciation update offers a rare chance for significant upfront tax savings and strategic financial planning. If you’ve been considering new investments or upgrades, this may be an ideal time to move forward. Take a look at your upcoming needs and speak with a trusted tax advisor to explore how bonus depreciation could support your business goals.