Bill H.R.1, the One Big Beautiful Bill Act, will now move on to the Senate.
What Is the “One Big Beautiful Bill”?
The One Big Beautiful Bill Act (OBBBA or OBBB) is a budget reconciliation bill proposed in the 119th Congress of the United States. It was approved by the House of Representatives on May 22, 2025, with a close vote of 215–214–1. The vote was mainly divided along party lines.
Bill H.R.1, the One Big Beautiful Bill Act, will now move on to the Senate.
The bill includes an additional $150 billion for defense spending and allocates $70 billion for border security, which would enable the deportation of up to 1 million individuals annually.
With its broad scope and symbolic title, “One Big Beautiful Bill” represents more than just a bundle of policy changes—it’s a statement of priorities, a test of party unity, and a sign of what’s to come in this legislative session.
Key Tax & Business Provisions Inside the Bill
Here are the key tax and business provisions you need to know about the One Big Beautiful Bill Act-
1099 Reporting Threshold Raised
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The threshold for reporting payments to independent contractors (Forms 1099-NEC and 1099-MISC) will increase from $600 to $2,000.
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Starting in 2027, this amount will be indexed for inflation—a long-awaited relief for small businesses and freelancers swamped by tax paperwork.
Bonus Depreciation Restored
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The bill restores 100% bonus depreciation for qualifying property placed in service between 2025 and 2029.
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This reverses the phase-out originally scheduled to eliminate full bonus depreciation by 2026.
Section 179 Deduction Expanded
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The Section 179 deduction limit will jump from $1 million to $2.5 million, with a phase-out beginning at $4 million in asset purchases.
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This gives small and mid-size businesses a major incentive to invest in equipment.
Business Interest Deduction Change
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Pre-2017 rules allowed full deduction of business interest.
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H.R. 1 limits the deductibility of net business interest expense to 30% of adjusted taxable income. The new law starts with a broader definition of adjusted taxable income but significantly narrows that definition beginning in 2022.
R&D Expenses: Immediate Deduction Restored
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Businesses will again be able to immediately deduct research and development expenses starting in tax year 2025, rather than amortizing them over time.
What It Means for You
Whether you’re a freelancer, small business owner, or CFO, this bill will reshape your tax strategy starting in 2025. If passed by the Senate, it could bring much-needed relief—and new compliance obligations.
The Senate battle could redefine the future of business taxation.
