How the 2025 Tax Bill Could Affect Business Sales and Valuations
Note: This post was first written on April 30, 2025, about a tax bill that was being discussed at the time. Proposals change, and parts of this post may no longer be current. It was updated in October 2026. It is general information, not tax advice.
A White House press briefing on April 29, 2025 described business-focused parts of a tax bill then in Congress, shared by Secretary Bessent. Owners asked what it could mean for selling a business. The short answer: tax rules can change what a buyer or seller keeps after taxes, but a business is still valued mainly on its earnings and records. Here is what was described, what has happened since, and what to do about it.
What has happened since
Congress later passed a tax law, Public Law 119-21, commonly called the One, Big, Beautiful Bill Act, enacted July 4, 2025. We have checked only the business expensing items below against the IRS. We have not verified the other items from the April briefing as enacted, so do not treat them as settled.
- Equipment and other qualified property: The IRS says the law provides a permanent 100% additional first-year depreciation deduction for qualified property acquired after January 19, 2025. Source: IRS, Working Families Tax Cuts – Businesses.
- Factories and similar production buildings: The law adds an elective 100% deduction for “qualified production property,” generally nonresidential real property used in manufacturing, chemical production, agricultural production or refining. It has conditions, including that construction begins after January 19, 2025 and before January 1, 2029, and that the property is placed in service after July 4, 2025 and before January 1, 2031. Sources: IRS news release IR-2026-25 and IRS Notice 2026-16.
Details and IRS guidance continue to develop. Confirm the current rules with a tax advisor.
What the April 2025 briefing described
The briefing listed these business measures. The first two are covered above. For the rest, we have not confirmed what, if anything, was enacted.
- Full expensing for equipment: deduct the cost of equipment in the year of purchase instead of depreciating it over time.
- Full expensing for factories: deduct the cost of building or acquiring new factories in the year of purchase.
- Deregulation: fewer regulatory burdens on business.
- Lower energy costs: policies aimed at reducing energy costs.
- Regulatory certainty: a more stable regulatory environment.
The briefing also tied the plan to tariffs as a way to offset lost revenue. We have not checked how that played out, so this post does not rely on it.
What this can mean when you value or sell a business
Expensing changes tax timing, not what the business produces
A bigger first-year deduction for equipment can lower taxable income that year. It does not by itself make a business worth more to a buyer. For most owner-operated businesses, buyers start with Seller’s Discretionary Earnings, and depreciation is one of the normal add-backs. What SDE Means When You Sell an Owner-Operated Business explains why, and How We Value an Owner-Operated Business covers what moves the range after earnings.
Equipment still matters to a buyer
A buyer will look at the age and condition of your equipment and what it will cost to replace. Tax treatment may affect what a buyer pays after taxes. That is a question for the buyer’s and seller’s tax advisors, not something to assume.
Costs and conditions can still move earnings
Changes in energy, regulation or the cost of imported materials can affect a business’s earnings, depending on the industry. Buyers will look at earnings that are real and documented, as they always do.
What owners should actually do
- Talk to your CPA or tax advisor before you time a big equipment purchase or a sale around any tax change.
- Do not rely on this post, or any blog post, for tax advice. Rules vary by situation and can change.
- Keep your books clean and your add-backs documented. Buyers test every one.
- Get a starting range from earnings first. A calculator range is directional. It is not an appraisal and not a guaranteed price.
- Ask your advisor how the way the sale is structured can change the tax result.
A next step
If you want to see where the business stands before any tax conversation, start with the free valuation calculator.
By Michael DeVault, business broker and BBDG Nashville affiliate at BridgePoint Business Group.
