The One Big Beautiful Bill (OBBB) could lower Federal taxes and encourage investment, especially for pass-through businesses. At the same time, it may put pressure on state budgets and change regulations in certain industries. Business owners should start planning now. At Omimi, we see the effect in 3 key ways:
Immediate Impact on States and Local Businesses
Some states are expecting lower tax revenue because of changes at the federal level. This could lead to tighter state budgets, reduced grants, fewer tax credits, or the implementation of new state-level policies. In some areas, businesses may see higher state fees, fewer incentives, or changes in local programs that affect operating costs.
Regulatory and Industry Effects
The bill includes changes that affect how federal and state regulations work together. One area to watch is artificial intelligence. Some proposals could temporarily limit state-level AI rules, which would change compliance requirements for businesses that use AI tools or operate across multiple states. The bill also affects healthcare funding and subsidies. These changes could influence employer healthcare costs and hospital or provider funding in certain states, indirectly affecting businesses that offer employee health benefits.
Tax and Investment Changes That Matter Most
Several tax provisions in the bill favor business investment and pass-through entities. These include:
• Full expensing for certain capital investments
• Permanent or expanded deductions for pass-through businesses
• Changes to R&D and investment incentives
Together, these provisions can improve after-tax returns on equipment, software, facilities, and research spending. For many businesses, this means better cash flow in the short term and stronger reasons to invest in 2025–2026.
Bottom Line
This bill creates both opportunities and risks. It may reduce federal tax burdens and encourage investment, but it also introduces uncertainty at the state level and in certain regulated sectors.
Start by meeting with OMIMI and reviewing operations this month. Focus on tax timing, capital investment decisions, and a state-impact cash-flow scenario.
To get started:
• Are you a small or mid-size business?
• What type of entity are you (LLC, S-Corp, C-Corp, etc.)?
• How would you like us to assist you?
Contact Omimi & Associates, LLC to help you through this process.imi & Associates, LLC to help you through this process.