What the One Big Beautiful Bill Act (OBBBA) Means for Your Business and Family
The One Big Beautiful Act (OBBBA for short) passed on July 4, 2025. While most articles and social media posts are buzzing about it for higher click rates, they’re not breaking it down in a way thatactuallymakes sense for you in terms of what it means for your business and family.
At The Tara CPA Firm, we pride ourselves on educating you on all things taxes, money, and business ownership. In this post, I’ll break down the 8 most important highlights from the bill that could affect you, your business, and/or your family… all in plain English.
What the One Big Beautiful Bill Act (OBBBA) Means for Your Business and Family
1. Increased reporting threshold for 1099-Ks
Third-party platforms like PayPal, Stripe, and Venmo won’t have to issue a 1099-K unless you cross $5,000 in payments or have 50+ transactions in a calendar year, starting in 2026.
What this means for you:This reduces confusion and paperwork, but doesn’t change your responsibility to report all income. There are no implications impacting the amounts of tax.
2. Clearer rules for paying your kids
The IRS will now officially recognize age-appropriate work performed by your minor children as legitimate compensation, especially when working inside your business.
What this means for you:This is a green light to confidently implement the “pay your kids” strategy (legally & ethically) if you haven’t already.
3. Higher contribution limits for SEP IRAs
Small business owners will now be able to contribute up to 28% of net earnings (up from 25%) with a new annual cap of $78,000.
What this means for you:If your business is doing well and you’re looking for a way to lower your taxes and boost retirement, this makes SEP IRAs even more powerful.
4. Increased SALT cap (State & Local Tax deduction)
The federal cap on SALT deductions is increasing from $10,000 to $20,000 for joint filers, effective 2025–2027.
What this means for you:If you live in a high-tax state (like CA, NY, or NJ for example), this gives you more room to deduct state income taxes & property taxes.
5. Expanded Child Tax Credit
The child tax credit is increasing to $2,200 per child (for kids under age 13) and a larger portion will now be fully refundable.
What this means for you:Kids are expensive and every little bit helps.
6. TCJA provisions extended through 2027
Many parts of the 2018 Tax Cuts & Jobs Act– like the expanded standard deduction and lower individual tax brackets – were set to expire after 2025.
What this means for you:You’ll continue to benefit from lower income tax rates, a higher standard deduction, and bonus depreciation for at least two more years.
7. Annual gift & estate tax limits increased
The estate tax exemption is increasing to $14.5 million per person and the annual gift tax exclusion is rising to $20,000 per recipient.
What this means for you:This benefits high-net-worth families looking to pass wealth to children or grandchildren. If that’s you, it’s a good time to review your estate strategy.
8. 529 plan expansion for private K–12 use
529 accounts can now be used for up to $15,000 per year toward private or religious K–12 school tuition as well as tutoring, test prep, homeschooling and some therapies.
What this means for you:If you’re already saving in a 529 (or plan to), you now have more flexibility to use those funds earlier in your child’s education.
One Big Beautiful Bill Act (OBBBA): How Our Firm Can Help
Mid-year legislation can feel overwhelming, but honestly, it’s better than eleventh hour, end of December legislation passing. Our team is on top of the changes, and most importantly reviewing how it impacts our clients’ tax strategies. Overall, these changes are positive and give us more opportunities to get creative. And the good news is we still have 6 months to get ready!
We’re always here to help you understand what’s happening and what to do next so you can make smart and informed money moves for your business, your family, and your future.
If you have questions about any of this, send me a DM on Instagram and I’ll do my best to answer them. We’ll continue to track the rollout of this new legislation and will keep you posted as guidance becomes clearer.
Disclaimer:This article is not meant to be tax advice. This is not an all-inclusive list of business advice. Different rules may apply to each individual taxpayer’s specific situation. Please consult with your accountant. May contain affiliate links.
