A Business Spotlight on the ‘One Big Beautiful Bill Act’

By Anthony Birritteri, Editor-in-Chief On Jul 17, 2025

Despite the intrigue, criticisms, and rumors of what is in it and not in it, the “One Big Beautiful Bill Act” (OBBBA) that President Donald Trump signed on July 4 is beneficial to businesses and the average US citizen as it made permanent the provisions in the 2017 Tax Cut & Jobs Act that were set to expire at the end of this year.

At a virtual presentation this morning sponsored by the New Jersey Business & Industry Association (NJBIA), attorneys from K&L Gates, a national law firm with a major practice in Washington, D.C., deciphered some of the many aspects of OBBBA, detailing its impact on small businesses, the energy landscape, and healthcare.

Business Benefits

According to Mary Burke Baker, government affairs counselor at K&L Gates, OBBBA is favorable to businesses and is US centric in that it incentivizes manufacturing, supply chains and job creation in the states.

Burke Baker ran through a list of business benefits and incentives in the act, including making permanent the full 100% expensing of personal property used in a business, effective for any property acquired after Jan. 19, 2025, which is the date of Trump’s inauguration.

OBBBA permanently restores the ability to immediately deduct domestic research and experimental (R&E) expenditures. Previously, the deduction was being amortized over five years. Beginning this year, R&D expenses are totally deductible in the year they occurred, Burke Baker said.

There is a new provision that allows for full expensing of certain production facilities such as chemical, agricultural, manufacturing, mining, and refining, all to encourage domestic manufacturing and refining.

As Burke Baker explains, “If you begin [facility] construction after Jan. 19, 2025, and before Jan. 1, 2029, and the facility goes into service before 2031, you can deduct the entire cost of that production space less the office-type space. … The act also allows for the existing deduction for semiconductor manufacturing facilities to increase from 25% to 35%.”

Concerning the act’s provision on workers paying no taxes on tips, Burke Baker said employers have many questions on how that impacts tax withholding tables and what tips may qualify. She added that the IRS plans to issue guidance on the matter.

Energy

On the energy front, David Skillman, a partner at K&L Gates, said OBBBA imposes  tremendous changes on the renewable and overall energy incentive side of the tax code.

“From a top-level standpoint, the legislation cuts incentives in this space by $500 billion over the next decade. … It’s a tremendous change concerning [incentives] from the Inflation Reduction Act of 2022,” explained Skillman.

Discussing the non-tax energy provisions in OBBBA, K&L Gates partner, Matt Leggett described the numerous funding rescissions within the U.S. Department of Energy and the U.S. Environmental Protection Agency. This is impacting things like: state-based home energy efficiency contractor training grants; Department of Energy loan guarantee programs; advanced technology vehicle manufacturing programs; interregional and offshore wind electricity planning, modeling and analysis; funding for clean heavy-duty vehicles; grants to reduce air pollution at ports; funding for greenhouse gas reduction; and environmental justice law grants, to name a few.

On the federal land front, Leggett said there is a provision in the act that imposes acreage rental and capacity fees on renewable energy projects – specifically wind and solar – on developments on federal lands, similar to what other fuel developers are paying.

OBBBA also establishes a revenue-sharing program for renewable energy projects on federal lands. “So, going forward, New Jersey would be entitled to 25% of revenues that are derived from the federal government from any renewable energy production, specifically wind and solar, on federal lands within the state (basically offshore wind projects). Additionally, counties can claim 25% of that revenue if the project is in their jurisdiction,” Leggett said.

Healthcare

Victoria Hamscho, an associate at K&L Gates, covered the impact OBBBA will have on healthcare, which includes a $1 trillion reduction in healthcare spending over a 10-year period and the potential for 11 million people to lose health insurance via changes to Medicaid and the Affordable Care Act.

Hamscho said restrictions on healthcare insurance eligibility will impact American citizens, but especially immigrant groups, like exiles, refugees, and people with temporary protection status. Meanwhile, strengthened verification requirements will make sure that the Medicaid and Medicare programs are available to citizens, permanent residents, green card holders, and certain Cuban immigrants. 

Why OBBBA Passed

Providing background on why OBBBA was drafted and passed, Ryan Carney, government affairs advisor at K&L Gates, said it was all related to the 2017 Tax Cut & Jobs Act expiring.

“There was a big political imperative for the Trump administration and the Republican majority in the House and Senate to pass a big tax bill. Unless Republicans wanted to be on the hook for 90% of Americans getting a tax increase going into the midterms next year, they had a real political imperative to pass something,” he said.

He added that Democrats were jittery in letting the 2017 Tax Cut & Job Act expire as well. “I would argue that if the American people did not like most of the provisions in [the 2017 Act], the Democrats would have undone it when they had the opportunity in 2021 and 2022. [They could have] used the budget reconciliation process.”

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