As we settle into 2026’s shifting tax environment, business owners and high earners face a pivotal planning year. The One Big Beautiful Bill Act (OBBBA) — a sweeping tax law enacted July 4, 2025 — reshaped key provisions that previously were set to sunset under the Tax Cuts and Jobs Act (TCJA). Whether you run a growing enterprise, practice in a high-tax state, or are refining your legacy plan, now is the time to act.
Below are three strategic tax planning priorities every business owner should consider in 2026 — and how smart moves now can help you keep more of what you earn and build a stronger financial legacy.
1. Leverage the New SALT Deduction Opportunity
One of the most consequential changes for business owners and professionals in high-tax states like California is the expansion of the State and Local Tax (SALT) deduction
Under current law, the SALT deduction cap increased from the old $10,000 limit to up to $40,400 (and indexed annually) — a massive uptick that can materially reduce federal taxable income for those who itemize. This change remains in effect through 2029 before reverting to the $10,000 cap in 2030 absent further legislation.
The enhanced SALT cap is especially relevant for H.E.N.R.Y. clients (High Earners, Not Rich Yet) and medical professionals in high-tax states — where state income and property taxes routinely exceed the old cap. Even with a phase-out for taxpayers above certain income thresholds (beginning with MAGI over ~$500,000), many business owners will see a meaningful benefit compared to prior years.
Action Tip: Consider timing deductible state tax payments and reviewing pass-through entity tax (PTET) elections to maximize your SALT benefit in 2026.
2. Evaluate Section 179 & Bonus Depreciation for Growth Investments
Another potential game-changer from the OBBBA is the restoration of 100% bonus depreciation for qualifying business assets acquired and placed in service after January 19, 2025 — permanently reversing the phasedown that was scheduled to erode these deductions by 2027.
At the same time, Section 179 expensing thresholds have expanded, allowing business owners to immediately deduct substantial amounts (up to $2.5 million, subject to phase-out) for qualifying purchases such as equipment, software, and certain property improvements.
For entrepreneurs looking to scale operations, enhance productivity, or modernize technology, these provisions can generate powerful tax-savings in the year of acquisition — boosting cash flow and accelerating growth.
Key Considerations:
Evaluate planned capital expenditures before year-end to maximize first-year deductions.
Coordinate equipment purchases with your broader income-tax and cash-flow strategies.
Ensure depreciable assets meet eligibility criteria to capture 100% bonus depreciation for 2026.
3. Address Estate Exemption Anxiety with Intentional Legacy Planning
While OBBBA avoids a dramatic estate tax exemption cliff, it did reshape expectations for legacy planning. Under prior TCJA sunset rules, the federal estate and gift tax exemption was scheduled to decline sharply after 2025. Instead, the OBBBA raised the exemption to $15 million per person ($30 million for married couples) starting in 2026 — and indexed it for inflation in future years.
That’s good news for many business owners and families. But estate planning remains essential — not just for minimizing taxes, but for preserving your business and wealth transfer goals.
Even with generous exemptions:
Federal estate tax still applies at a 40% rate above the threshold.
State estate or inheritance taxes may apply on lower thresholds.
A proactive plan ensures your business transition and legacy wishes align with your family’s needs.
This creates a natural connection to our Estate Strategy and Business Succession services, where we help clients lock in legacy outcomes that reflect both tax efficiency and personal priorities.
Bring It All Together: Tailored Planning for Business Owners in 2026
The 2026 tax landscape doesn’t merely require compliance — it rewards strategic action:
Maximize the expanded SALT deduction if you’re in a high-tax state.
Accelerate capital investments that qualify for Section 179 and bonus depreciation.
Revisit your estate and succession plan in light of new exemption levels and your long-term goals.
If you’re aiming to build wealth efficiently, protect it through thoughtful legacy planning, and navigate these shifts with confidence, you’ll benefit from a personalized approach that considers both tax law and your unique financial situation.
For practical next steps, revisit our related planning frameworks — like our Top 5 Financial New Year’s Resolutions for H.E.N.R.Y.s (High Earners, Not Rich Yet) — to start aligning your 2026 strategy with your goals.
Ready to Plan Your Next Move?
Schedule a complimentary consultation with our team at BAS Financial to discuss how these tax law changes apply to your business, practice, and legacy. We’ll craft a tailored plan that helps you thrive in the 2026 tax landscape — not just react to it.
Sources
“New SALT Cap Deduction: Unlock Massive Tax Savings with Non-Grantor Trusts,” Kiplinger — on SALT cap increases and benefits.
“Expiring Tax Provisions Big Issue for 2025,” Center for Agricultural Law and Taxation — on bonus depreciation sunset history and expensing rules.
“Tax Changes and Planning Opportunities for 2026,” Reinhart Law — on estate and gift tax exemptions and planning.
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San Diego, CA 92121
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This information is based on our understanding of current rules and regulations and is intended for general informational purposes only. Financial advisors do not provide tax, legal, or accounting advice. You should consult your own tax, legal, or accounting professional regarding your individual situation.