Posted in Blog
By Tony Liu, Founder and Principal Business Trial Attorney
In Summary:
Congress just rewrote 900 pages of tax law. The Big Beautiful Bill locks in 2017 corporate & pass-through cuts, makes tips + overtime tax-free, restores 100 % bonus depreciation through 2027, and lifts the SALT cap to $40 K. We unpack the wins, flag hidden risks, and give you a five-step, 30-day action plan.
Congress approved President Trump’s One Big Beautiful Bill yesterday, capping a nail-biter 218-214 House vote. At 900 pages, the law rewrites large parts of the tax code, pours $175 billion into border security, and slices deep into social-service programs—all in one stroke. thetimes.co.uk
Tax Cuts 2025 – What Actually Changes?
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Permanent 2017 rate cuts for corporations and pass-throughs
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“No tax on tips & overtime” through 2028
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100 % bonus depreciation on qualified assets placed in service 2025-2027
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SALT cap jumps to $40,000 (up from $10k), indexed 1 % per year
These headline items are designed to goose hiring and investment while sweetening paychecks for service-sector staff. forbes.com
Pros and Cons for California & OC Businesses
SALT Deduction Cap Increase to $40,000
Pro: Owners in high-tax states like California gain a larger write-off for property and state income taxes.
Con: The benefit phases down for earners above $500 k, and critics say it skews relief toward higher-income households. taxfoundation.org
100 % Bonus Depreciation – Equipment & Real Estate
Pro: Immediate expensing can slash this year’s tax bill when you buy or build qualifying assets (machinery, tenant improvements, even some real estate).
Con: The window is short—full expensing sunsets after 2027—so cash-flow planning is critical. axios.com bakerbotts.com
Medicaid & SNAP Cuts – Indirect Risk
If your customers, tenants, or vendors depend on federal aid, reduced benefits could dent their spending power and contract stability, raising credit-risk exposure for B2B firms. thetimes.co.uk vox.com
30-Day Action Plan for Business Owners
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Run a 2025 tax-projection. Model new rates, SALT, and bonus depreciation to spot early savings.
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Fast-track cap-ex decisions. Sign POs or purchase agreements before Q4 to lock in 100 % expensing.
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Update payroll systems. Reclassify tip and overtime fields so they flow to employees tax-free.
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Review vendor contracts. Insert price-adjustment clauses if Medicaid or energy-credit changes hit their margins.
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Book a compliance check. Our litigators can flag exposure in handbooks, independent-contractor agreements, and indemnity clauses.
Need a guided walkthrough? Schedule a “Bill Impact Audit” with Focus Law’s business-tax team today.
Quick Q&A
– When do the new tax rates take effect?
Most provisions, including rate cuts and SALT expansion, start January 1 , 2026; bonus depreciation is available for assets placed in service after Jan 19 , 2025. bakerbotts.com
– Is “no tax on tips” really 100 %?
Yes—cash and credit-card tips plus overtime wages are exempt from federal income tax through 2028, but FICA/Medicare still apply. vox.com
– Will California conform to these changes?
Not automatically. Sacramento historically decouples from federal bonus depreciation; watch for a state trailer bill this fall.
– Can I still claim solar credits from 2024 projects?
Yes, projects with binding contracts signed before the law’s enactment keep legacy credits; new installations lose the credit beginning 2026. axios.com
– What if the Senate amends the law again?
Major tax items are reconciliation-protected; tweaks are possible, but core business provisions are unlikely to be clawed back this fiscal year.
