As small business owners face continued inflation and rising tariffs, the One Big Beautiful Bill Act (OBBB) could provide critical financial relief for Main Street businesses. By extending key provisions from the Tax Cuts and Jobs Act of 2017 (TCJA), the legislation aims to stabilize jobs, simplify taxes, and encourage long-term investment in growth. Read on as we discuss how the OBBB could affect small businesses.
How the 2017 TCJA Has Helped Small Businesses
The Tax Cuts and Jobs Act, passed in 2017, introduced a number of changes that gave small businesses some breathing room. It expanded deductions for everyday business expenses, simplified some accounting rules, and offered new incentives for research and development. With those savings, many small business owners were able to put more money back into their operations—hiring staff, upgrading equipment, or simply staying competitive in a tough market.
One of the most important parts of the TCJA was the tax break it gave to pass-through businesses and sole proprietors, which make up a big chunk of the small business world. For many owners, those savings meant they could afford to hire more people, raise wages, or offer better benefits. In tough economic times, it often meant the difference between staying open or shutting the doors for good.
Why Extending TCJA Provisions Matters Now
Good news for small business owners: the OBBB Act brings back several tax breaks from the TCJA that are set to expire. With inflation driving up the cost of everything from supplies to labor, and tariffs squeezing profits, these extended tax benefits could help ease the financial strain and make it easier for businesses to keep their employees on payroll.
According to the House Ways and Means Committee, keeping the 2017 tax cuts in place could help protect around 6 to 7 million full-time jobs, most of which fall within the small business sector. On the other hand, letting these provisions expire could lead to a net loss of 6 million full-time positions. That would be a blow to the small businesses that drive innovation and employment.
Protecting Jobs and Supporting Growth
Tax policy is a budgeting tool for business owners who are trying to plan for the future. Without continued relief, small businesses might have to scale back operations, delay any expansion plans, or cut jobs. This could weaken the role of small businesses as a major source of job creation in the U.S., especially at a time when inflation is already making it harder for both households and businesses to manage their budgets.
Keeping the most effective elements of the TCJA under the OBBB Act would give small business owners the confidence and financial stability to maintain their workforce and pursue long-term investment strategies. These elements include maintaining deductions for new equipment, continuing R&D tax credits, and keeping simplified tax filing thresholds in place—all of which help to reduce administrative burdens and free up capital for growth.
A Lifeline for American Small Businesses
Whether it’s retaining employees, investing in new equipment, or expanding into new markets, the tax breaks carried over from the TCJA through the OBBB Act could give small businesses the stability they need to navigate current challenges and plan for long-term growth.
