Small Business Prosperity Act of 2025

The Small Business Prosperity Act of 2025 increases tax relief for small business owners by raising the Qualified Business Income (QBI) deduction rate from 20% to 43% (47% after 2025), removes wage-based limits on eligibility, and expands the deduction to include professions like law and medicine. It also prevents taxable events when businesses restructure without changing ownership and repeals the federal estate tax for deaths after 2024. These changes directly affect pass-through business owners (e.g., sole proprietors, partnerships, S corporations) in the U.S. and Puerto Rico, lowering their federal tax burden. The bill takes effect for tax returns filed in 2025 and later.