Introduction
Trump’s 2025 tax proposal includes powerful incentives for U.S. businesses, particularly small and pass-through entities. These changes aim to stimulate investment, reward domestic hiring, and simplify compliance for entrepreneurs. From expanding the Qualified Business Income (QBI) deduction to increased asset expensing and reduced corporate tax exposure, this blog explains how your business may benefit and what steps to take to comply and plan ahead.
Key Business Tax Provisions (IRC References)
Here’s a breakdown of the proposed business-friendly provisions and the Internal Revenue Code sections they may affect:
- IRC §199A – Retention and potential expansion of the QBI deduction for eligible pass-throughs
- IRC §168(k) – Enhanced bonus depreciation or expensing of capital assets
- IRC §179 – Potential increase in the cap for Section 179 expensing of equipment
- IRC §11 – Sustaining the corporate tax rate at 21%, with proposals for future reductions
- IRC §41 – Simplified and expanded R&D tax credits for small businesses
- IRC §274(n) – Modifications to business meal deductions or fringe benefits
IRS Forms for Business Compliance
- Form 1120 / 1120S / 1065 – Depending on your entity type (C-Corp, S-Corp, or Partnership)
- Form 8995 / 8995-A – For claiming the QBI deduction
- Form 4562 – For Section 179 and depreciation reporting
- Form 6765 – For the Research & Development tax credit
- Form 941 – For payroll tax filings that may tie to employee-based credits
Example Scenario
Case: Lina owns a Wyoming-based SaaS startup (LLC taxed as S-Corp)
- Net business income: $160,000
- Eligible for QBI: $32,000 deduction under IRC §199A
- New equipment: $80,000 expensed under proposed Section 179 cap
- Payroll tax credits available: $5,000 (retention or hiring credits)
Total estimated tax savings (QBI + depreciation + credits): $25,000+
Key Benefits of Trump’s 2025 Business Tax Proposals
- 20% QBI Deduction Continued – Significant tax relief for LLCs, S-Corps, and freelancers
- Full Equipment Write-Offs – Businesses can expense more assets immediately
- Flat Corporate Rate – Continues to favor C-Corp structuring for reinvestment
- Startup-Friendly R&D Credits – Simplified claims and broader eligibility
- Potential Payroll Credit Add-Ons – For domestic hiring or job retention
Step-by-Step IRS Compliance Guide
- Determine Entity Structure – Ensure your entity type (LLC, S-Corp, etc.) aligns with the deduction and credit strategies.
- Calculate QBI – Use Form 8995 or 8995-A to compute the deduction.
- Track Asset Purchases – Log assets that qualify for Section 179 or bonus depreciation.
- Identify R&D-Eligible Expenses – Software development, prototypes, automation qualify under IRC §41.
- Leverage Payroll Credits – If offered, claim hiring or retention credits using IRS guidance.
- File Timely & Correctly – Ensure Form 1120, 1065, or 1120S includes all deductions and schedules.
Conclusion
The 2025 tax reform aims to position U.S. businesses for aggressive growth by offering enhanced deductions, asset write-offs, and structural flexibility. Whether you operate as a freelancer, tech founder, or established corporation, these proposed changes can significantly reduce your tax liability if you plan ahead and comply properly.
Call to Action
Is your business positioned to benefit from Trump’s 2025 tax breaks?
From QBI optimization to equipment write-offs and R&D credits, these new provisions could save your business thousands in federal taxes.
Start planning your 2025 savings now:
Book a meeting with Anshul Goyal, CPA, EA, FCA
About Our CPA
Anshul Goyal, CPA, EA, FCA, is a U.S.-licensed Certified Public Accountant and Enrolled Agent with extensive experience advising U.S. and India-based businesses. He assists LLCs, tech founders, S-Corp owners, and C-Corps with strategic tax planning, entity structuring, and IRS compliance.
Disclaimer
This blog is intended for informational purposes only and should not be considered tax, legal, or financial advice. Each business has a unique tax profile. Consult with a licensed tax professional before acting on any information.