S 2443, the Veterans Jobs Opportunity Act, creates a federal tax credit for veteran-owned small businesses. It provides a 15% credit on up to $50,000 in qualified start-up expenses (like equipment or real property) for businesses owned and controlled by veterans or their spouses, located in underserved communities (such as HUBZone areas, empowerment zones, or low-income counties). The credit applies only to the first two taxable years of business operations and requires the business to meet specific size thresholds (under $5 million in gross receipts or 50 full-time employees). This policy directly supports veterans starting businesses in economically disadvantaged areas through tax relief.
This bill creates new retirement savings credits for small tax-exempt nonprofits (like community centers or charities) that start or maintain retirement plans. It allows these organizations to claim a credit equal to either their calculated credit amount or their payroll taxes paid during the year, whichever is smaller. The credit applies to both startup costs for new plans and auto-enrollment features, capping the credit at the employer's payroll tax liability. The bill takes effect for taxable years after December 2024, with offsetting funds transferred to Social Security Trust Funds to maintain existing revenue streams.
This bill, S 1613 (Tax Relief for New Businesses Act), simplifies tax deductions for new businesses forming corporations or partnerships. It combines "start-up" and "organizational" expenses into one deductible category, increasing the annual deduction limit from $5,000 to $50,000 (and the phaseout threshold from $50,000 to $150,000). It also creates special rules allowing new businesses to treat start-up/organizational losses separately when calculating net operating loss carryforwards, with more favorable tax treatment for these losses. The changes apply to expenses paid or incurred in taxable years beginning after December 31, 2025.
This bill extends a tax credit for employer social security taxes related to tips earned by employees in beauty service businesses (including barbering, nail care, esthetics, and spa treatments). It requires that tips from these services exceed 15% of the business's gross receipts to qualify for the credit. The bill also creates a "tip reporting safe harbor" for beauty service employers who implement training programs, monthly tip reporting by employees, and maintain records for four years, shielding them from IRS tip examinations unless an employee complaint arises. Additionally, it mandates that landlords renting space to two or more beauty service businesses (with $600+ in annual rent) must report rental income details to the IRS. These provisions apply to taxable years beginning after 2024 or 2025, depending on the section.
HR 4933, the Research and Development Tax Credit Expansion Act of 2025, expands tax benefits for small businesses conducting research. It increases the refundable R&D credit rate to 20% (from 14%) for qualified small businesses, adjusts credit amounts for inflation annually, and allows the credit to be refunded against unemployment taxes instead of just income taxes. The bill broadens eligibility by raising the gross receipts threshold from $5 million to $10 million for "qualified small businesses" and modifies rules for calculating credits in early years of research activity. These changes apply to taxable years beginning after December 31, 2025, directly affecting qualifying small businesses with under $25 million in annual revenue.
The CHOICE Act creates a new type of employer-funded health benefit called a "CHOICE arrangement," allowing small employers to reimburse employees for individual health insurance costs. It directly affects small businesses (not large employers under ACA rules) and their employees who choose individual marketplace coverage or specific government health programs. Key provisions include employer tax credits ($100/month for the first year, $50/month for the second year per employee), strict rules to prevent discrimination in plan access, and requirements for employees to maintain qualifying health coverage. The law takes effect for plan years beginning after December 31, 2025, providing a new option for small employers to offer health benefits without traditional group plans.
This bill creates a new payroll tax deduction for qualifying small businesses, allowing them to deduct 12% of wages paid to designated low-wage employees. It directly affects small businesses meeting specific criteria: those with no more than 15 full-time employees, meeting gross receipts limits, and certifying compliance. The deduction applies only to the lowest-wage full-time employees (excluding high earners), with the number of eligible employees decreasing annually (starting at 10 in 2026 and ending at 4 in 2033). The provision expires after 2033 and applies to taxable years beginning after December 31, 2025.
HR 1753 creates two new tax credits to support local journalism and small businesses. It offers a 80% credit (up to $5,000) for eligible small businesses (with <50 full-time employees) that advertise in qualifying local media like community newspapers or FCC-licensed radio/TV stations, reducing to 50% ($2,500 max) after the first year. A separate credit provides 50% (then 30%) of wages paid to local news journalists (at least 200 hours quarterly) for employers whose primary income comes from local newspaper publishing, capped at $12,500 per journalist per quarter. Both credits expire after 5 years and require strict definitions of "local" media to qualify, including having in-community journalists and limiting corporate ownership. The bill directly affects small local news publishers and qualifying small businesses seeking tax relief for local advertising and journalism staffing.
This bill creates a $200 million fund for small businesses that suffered at least a 25% revenue loss due to recent federal immigration enforcement actions in their area. Eligible businesses must be small (as defined by the Small Business Act), not operate over 15 locations, and not be publicly traded. Grants cover verified revenue losses up to $1 million total per business or $500,000 per physical location, with applicants certifying they haven’t received other compensation for these losses. The fund, available for fiscal year 2026, requires fraud checks including tax verification and database cross-referencing during applications.
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Small Business
This bill provides tax relief for small businesses by creating a graduated corporate tax rate, where businesses with taxable income under $5 million would pay 18% on the first $400,000 of income and 21% on the remainder. It establishes special tax treatment for investment management services provided through partnership structures, reclassifying certain capital gains and losses as ordinary income or loss for these specific partnerships. The bill also includes an enhanced deduction for lower-income self-employed individuals with adjusted gross income under $400,000 and increases the excise tax on corporate stock repurchases from 1% to 1.5%. These provisions primarily affect small businesses, small business owners, and investment management professionals operating through partnership structures.
