Countdown to Change: Key TCJA Provisions Set to Expire Soon

ARTICLE | October 01, 2024

Authored by Vasquez + Company

The Tax Cuts and Jobs Act (TCJA) introduced critical federal income tax provisions for small businesses, many of which are set to expire soon. This article outlines five key provisions, their potential expiration, and the implications for business owners if Congress does not act to extend or make them permanent.

Key Points:

• Individual Tax Rates: Temporary lower tax rates on business income are set to revert to higher rates in 2026 if Congress takes no action.
• QBI Deduction: The 20% deduction for qualified business income may disappear after 2025, impacting many small business owners.
• Employee Deductions: The suspension of deductions for unreimbursed business expenses will revert to less favorable rules post-2025.
• Bonus Depreciation: The current 100% bonus depreciation is gradually decreasing, with full expiration slated for 2027 if no extension occurs.
• Excess Business Losses: Current limitations on business losses will revert to pre-TCJA rules after 2028 if Congress allows them to expire.

With uncertainty surrounding these provisions, business owners must proactively engage with tax advisors to navigate the impending changes.

For more information, read the full article here.

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