The One Big Beautiful Bill Act (OBBBA): Strategic U.S. Tax Reset for Cross-Border Founders

If you’re a founder scaling a cross-border business — whether you’re a Canadian company expanding into the U.S., a U.S. entrepreneur with international operations, or a global founder — the One Big Beautiful Bill Act (OBBBA) is the most significant U.S. tax reset in a generation.

Passed July 4, 2025 and effective January 1, 2026, OBBBA builds on the 2017 Tax Cuts and Jobs Act (TCJA), making favorable provisions permanent while adding new tools to cut taxes and supercharge investment.

This isn’t just about what changed — it’s about how to align tax strategy with business growth. Let’s dive into the biggest opportunities for cross-border business owners, founders, and investors — and what actions to take before the end of this year.

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Key Tax Opportunities Under the One Big Beautiful Bill Act

From expanded deductions to time-sensitive credits, these highlights show where founders and taxpayers can capture the most value under the new law.
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‍1. 100% Bonus Depreciation (Now Permanent)

OBBBA makes 100% bonus depreciation permanent for qualifying assets placed in service after January 19, 2025.

• Deduct the full cost of equipment, machinery, furniture, and vehicles in year one.
• Drive taxable income to $0 or create losses to offset future gains.

Perfect for U.S.-based entities and cross-border businesses reinvesting heavily in growth.
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2. Section 179 Expensing: Flexible Deductions

The Section 179 expensing limit under OBBBA more than doubles, jumping from $1.16 million to $2.5 million per year. Like bonus depreciation, Section 179 allows you to deduct the full cost of qualifying assets in the first year, but it offers more flexibility in how you apply it.

Here’s the key difference: bonus depreciation applies across an entire asset class and can push your income below zero to create losses, while Section 179 is applied per asset and cannot create a loss. That means with Section 179, you can choose exactly which assets to expense and how much to deduct, giving you more control over your taxable income.

Strategic takeaway: Bonus depreciation is best for maximizing deductions quickly, while Section 179 is ideal for targeted tax planning — especially if you want to stay in lower tax brackets instead of wiping out your income completely.

3. Manufacturing Property Deduction: A Game-Changer

A hidden gem for foreign-owned U.S. businesses:

This is a major shift from prior law, where commercial real estate had to be depreciated over 39 years, creating only small annual deductions. Now, instead of waiting decades to recover costs, you get immediate tax relief that can be reinvested into operations, hiring, or expansion.

• Deduct the full cost of U.S. manufacturing facilities, warehouses, or production spaces in year one.
• No more 39-year depreciation schedules.
• Example: A $2M facility deduction in year one vs. $51K/year for 39 years.

If you’re considering a U.S. facility, the timing of your investment matters. Planning ahead could mean millions in accelerated deductions and faster returns on capital.

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Strategic Alignment: Tax Planning + Business Goals

Why Bracket Management Matters

If you take too many deductions all at once, driving your taxable income to zero, you might lose access to important benefits like:

• 199A Qualified Business Income Deduction (QBID), which gives you a 20% deduction from passthroughs like S-corps or partnerships.
• Risk higher future tax brackets (35%–37%).

Tax bracket smoothing ensures consistent use of low brackets (10%–24%) year over year — creating long-term savings.

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Case Studies for Cross-Border Founders

To see how the OBBBA provisions work in practice, consider these two scenarios.

Case 1: Foreign-Owned U.S. Expansion

A foreign-owned company expanding into the U.S. reports $2 million in revenue and $1.2 million in expenses (excluding depreciation) in its first year. The business also purchases $800,000 worth of equipment. Under GAAP depreciation rules, it would only deduct about $160,000 in year one, resulting in $640,000 of taxable income. But with bonus depreciation, the entire $800,000 can be deducted immediately, driving taxable income to zero and saving roughly $134,400 in federal tax at the 21% corporate rate.

Case 2: U.S. S-Corp Flow-Through

A U.S. S-corporation has similar revenue, expenses, and equipment purchases but flows its income through to the owner’s personal return. Using bonus depreciation wipes out taxable income in year one — but it also means the owner loses the 199A Qualified Business Income Deduction (QBID). In year two, with no depreciation left, the $800,000 of income pushes the taxpayer into the 37% bracket, erasing much of the prior year’s savings. The key takeaway: S-corp owners need careful income smoothing to maximize the QBID and avoid bracket spikes.

Takeaway: S-corps must smooth income carefully.

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More OBBBA Advantages: From Innovation to Personal Savings

Beyond its headline reforms, the OBBBA introduces a host of lesser-known provisions that help both businesses and individuals save, innovate, and plan smarter.

1.R&E Expensing Returns

• OBBBA restores full expensing for U.S.-based research and experimentation (R&E), reversing the rule that forced amortization over five years.
• The change is retroactive to 2022, meaning businesses can amend prior returns or elect to accelerate deductions.
• This creates immediate tax relief and encourages innovation-driven companies to continue investing in product development.
  

2. Permanent QBID + Enhanced QSBS

• The Qualified Business Income Deduction (QBID) — a 20% deduction on domestic pass-through income — is now permanent.
• Phaseouts still apply above $400K for joint filers ($200K for singles), and service businesses may face limits.
• Qualified Small Business Stock (QSBS) rules expand, allowing up to $15M in capital gains to be excluded for certain U.S. C-corp stock held at least five years.
• Together, these changes strengthen both pass-through structures and long-term exit planning for founders and investors.
  

3. Individual Benefits

• Standard deduction is preserved, and an additional $6,000 deduction is available for seniors (2025–2028).
• The Child Tax Credit rises to $2,200 per child, indexed annually, providing meaningful relief for families.
• The SALT deduction cap increases to $40K, easing the burden for high-tax states.
• Temporary “no tax on” carveouts (2025–2028) allow deductions for up to $25K of tips, $25K of overtime, and $10K of car loan interest for U.S.-assembled vehicles.
  

4. Trump Accounts + Expanded 529s

• Trump Accounts provide a $1,000 government seed contribution for children born between 2025–2028, with up to $5K annual contributions until age 18.
• Funds can later be used for education, a first home, or to start a business, before converting to a traditional IRA at adulthood.
• 529 education plans are broadened to cover homeschooling, K–12 expenses, and credentialing costs, with unused balances eligible to roll into Roth IRAs.
  

5. Estate & Gift Planning

• The federal estate and gift exemption increases to $15M, indexed starting 2026, and is made permanent.
• Families can take advantage of lifetime gifting strategies while asset values remain relatively low.
• Coordination is essential for cross-border families, as state estate taxes (e.g., in Massachusetts or New York) may apply at much lower thresholds.
  

6. Green Incentives (Act Fast)

• Key deadlines: EV credits expire Sep 30, 2025; home energy and clean energy credits (solar, wind, battery) expire Dec 31, 2025.
• Quick action: schedule purchases/installs and document eligibility now — these credits can cut thousands off project costs if claimed before the deadlines.
  

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Global Tax Changes for Cross-Border Businesses

For founders with international operations, OBBBA introduces major shifts in how foreign income and structures are taxed — changes that could significantly impact global planning.

1. GILTI Becomes NCTI

• The Global Intangible Low-Taxed Income (GILTI) regime is renamed Net CFC Tested Income (NCTI).
• Section 250 deduction drops from 50% → 40%, while the QBAI exclusion is eliminated, potentially raising taxable income for asset-heavy companies.
• The foreign tax credit haircut improves from 80% → 90%, and high-tax exceptions plus 962 elections remain available.
  

2. FDII → FDDEI

• The Foreign-Derived Intangible Income (FDII) deduction is rebranded as the Foreign-Derived Deduction Eligible Income (FDDEI).
• The deduction percentage falls to 33.34%, reducing its value for IP transfers and intangible sales.
• However, new sourcing rules expand foreign tax credit eligibility for certain export transactions.
  

3. New Remittance Excise Tax (2026)

• Starting in 2026, a new 1% excise tax applies to certain remittances sent abroad.
• It covers transfers funded with cash, money orders, or checks, while credit/debit card and U.S. bank-funded transfers remain exempt.
• This primarily impacts U.S. residents sending personal transfers overseas, but businesses should review payment processes to ensure compliance.
  

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Next Steps for Cross-Border Founders

The One Big Beautiful Bill Act opens new doors for founders, but the benefits only materialize with proactive planning. Your tax strategy should align with your business plan — whether you’re preparing for an exit, raising capital, or building long-term assets. Managing your taxable income strategically year over year helps you use lower tax brackets consistently instead of dropping to zero one year and jumping to 37% the next.

Acting now can also help you capture time-sensitive incentives. EV credits expire in September 2025, while many clean energy credits end December 31, 2025. If you’re considering a facility purchase, an EV fleet, or installing solar, plan the timing before these deadlines. And for businesses with global operations, the new NCTI/FDDEI rules and the 1% remittance excise tax coming in 2026 may require restructuring or process changes.

In short, the earlier you align tax strategy with your growth goals, the more you can reinvest, protect, and scale.

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Let’s Talk Strategy

Want clarity on how OBBBA affects your cross-border business, U.S. investments, or estate plan?

We’re already helping clients:

• Restructure for long-term tax efficiency
• File R&E claims retroactively
• Plan for optimal bracket use
• Revisit global transfer flows
• Update estate strategies under new exemptions

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Book a strategy session today or follow me on LinkedIn for weekly cross-border tax insights.

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