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Big Beautiful Bill Offers Direct Tax Relief to Small Businesses Across the US

By Joseph Provence, a news contributor who writes about technology, small business, and e-commerce.

July 29,2025 2:30 PM MST

In a bipartisan move aimed at easing financial pressures on small businesses, Congress has passed the Big Beautiful Bill (BBB) for Small Business Tax Cuts. The legislation is expected to deliver targeted federal tax relief, with the potential to inject over $75 billion into the small business economy over the next five years, according to the Congressional Budget Office.

The BBB introduces a structured set of tax incentives designed to help small business owners improve cash flow, expand operations, and retain employees. The new bill increases the Section 179 deduction limit to $2 million, allowing businesses to deduct the full purchase price of qualifying equipment or software bought or financed during the tax year. Additionally, the bill reduces the corporate income tax rate for businesses with annual revenues under $5 million from 21 percent to 15 percent.

Impact on Small Businesses

Small businesses, which make up 99.9 percent of all U.S. businesses according to the Small Business Administration (SBA), have historically faced higher barriers when accessing capital and managing tax liabilities. With inflation and interest rates continuing to weigh on growth, many entrepreneurs welcome the BBB’s straightforward benefits.

“This bill is a step toward economic stability for main street business owners,” said Kaaren Provence, co-founder of Salt Creative, a small business consulting & web design firm. “Lowering tax rates and increasing deductions gives local entrepreneurs room to reinvest in their communities.”

The National Federation of Independent Business (NFIB) projects that the tax rate reduction alone could increase net profits for the average small business by 8 to 12 percent annually. That translates to more funds available for hiring, equipment upgrades, or paying down debt.

What’s Included in the Big Beautiful Bill

Key provisions of the bill include:

  • An increase of the Section 179 deduction limit to $2 million
  • A flat 15 percent federal corporate income tax rate for businesses under $5 million in annual revenue
  • A simplified home office deduction of $2,500 annually
  • A 50 percent payroll tax credit for businesses with fewer than 25 full-time employees
  • A two-year federal student loan forgiveness incentive for employees of qualifying small businesses

How to Apply for Assistance Under the BBB

Eligible businesses can apply for assistance through the IRS website or by contacting their local SBA office. To qualify, a business must:

  • Have fewer than 100 employees
  • Generate less than $5 million in annual revenue
  • Operate as an LLC, sole proprietorship, partnership, or S corporation
  • Be in good standing with federal tax requirements

Business owners are advised to gather key documentation before applying. This includes prior year tax returns, payroll records, and proof of equipment purchases if applying for the Section 179 deductions.

As the federal government looks to encourage entrepreneurship and local economic development, the Big Beautiful Bill positions small businesses to thrive in a changing financial landscape.