Small business advocates are calculating the impacts of the Big Beautiful Bill that President Donald Trump signed this summer.
Some say tax cuts and other reforms are a win, while others say they’ll undermine business growth.
We break down what we know.
A 20% tax deduction
The federal budget passed by Republicans extends a 20% tax deduction for many small businesses. It first passed in 2017 and was slated to expire later this year.
Dale Steenbergen, CEO and president of the Greater Cheyenne and Wyoming chambers of commerce, said the extension will help business owners in the region.
“When they get a few more bucks in their pocket from a tax cut or from other savings, they're able to invest that in employees and in infrastructure and all the things that help them build to the future,” he said.
Others say these tax cuts disproportionately favor the wealthy. That includes the Small Business Majority, an advocacy group with offices in Colorado, New Mexico and several other states.
The group pointed to a Brookings Institution study, which found that about three-quarters of the Trump-backed tax breaks went to the top 5% of earners in 2023.
“[It doubles] down on tax policies skewed to the wealthiest businesses and individuals that would barely make a dent in what most Main Street small businesses owe each year,” Small Business Majority Founder and CEO John Arensmeyer said in a press release.
Steenbergen countered that the tax cuts are still a net positive for small businesses.
“ We really focused on how do we get money in the pockets of small businesses across our state so that they can hire employees, pay bills, shop with their neighbors,” he said.
Research and equipment write-offs
Small businesses can also now fully deduct research expenses immediately, instead of over a period of five or 15 years. They can apply this retroactively to 2022.
They can also write off more equipment expenses. The cap for deductions went from $1 million to $2.5 million, another plus according to Steenbergen.
“That's their lifeline of the future if they can buy new equipment and do research in a very fast changing economy,” he said.
Medicaid cuts
Steenbergen is waiting to see how a trillion-dollar cut to Medicaid health insurance for low-income Americans will impact business owners. He said he and his staff are reaching out to insurers and local hospitals to figure out what the cuts could mean.
“If it does impact those guys a lot, and that's the way the numbers turn out, certainly that could be an increased expense for small business,” he said.
A new analysis from Georgetown University and the Small Business Majority found one-third of people enrolled in Medicaid nationwide owned a small business, were employed by one or were linked by family. Cuts could make it harder for these businesses to provide health insurance.
“Medicaid cuts put the health and economic security of a significant share of the small business workforce at risk,” the analysis said.
Child care tax credits
The Big Beautiful Bill increased employer-provided child care tax credits from 25% to up to 50% for eligible small businesses. Steenbergen said this could help keep more parents in the workforce who are dealing with high costs for child care.
“ I think it takes a stab at trying to deal with that,” Steenbergen said. “We've got more work to do on that issue, but it sends us down the right direction.”
This story was produced by the Mountain West News Bureau, a collaboration between Wyoming Public Media, Nevada Public Radio, Boise StateCRED Public Radio in Idaho, KUNR in Nevada, KUNC in Colorado and KANW in New Mexico, with support from affiliate stations across the region. Funding for the Mountain West News Bureau is provided in part by the Corporation for Public Broadcasting.
