News from associated
builders and contractors

In July 4, 2025, President Donald Trump signed H.R. 1, the One Big Beautiful Bill Act, into law, providing an avenue for tax relief to the U.S. construction industry and Main Street businesses nationwide.

This legislation provides certainty to the more than 95% of all American businesses structured as S corporations, partnerships and sole proprietorships. These pass-through businesses employ 62% of the private sector workforce and form the economic backbone of virtually every community nationwide.

What sets this bill apart from other bills in the past is that the largest parts of the OBBB set a low, permanent tax rate for businesses across industries—unlike the Inflation Reduction Act which chose sectors to incentivize—picking winners and losers.

The construction industry will benefit from the following reforms included in the bill:

• Making the small business deduction permanent: Solidifying the Section 199A deduction will provide tax certainty for pass-through businesses, allowing contractors to reinvest in their operations and workforce without fear of future tax hikes.
• Permanent estate tax relief: This provision ensures that family-owned construction businesses can pass along ownership to the next generation without facing destructive estate tax burdens.
• Restoration of 100% bonus depreciation: Renewing immediate expensing of capital investments through 100% bonus depreciation will encourage construction firms to invest in new equipment and technologies—boosting productivity and economic growth.
• Revived expensing of R&D costs: The bill permanently restores the ability for businesses to immediately deduct domestic research and experimental expenditures, providing critical support for construction innovation. Whether it’s hands-on problem-solving that happens on jobsites or improving project delivery methods, this provision gives contractors the financial flexibility to invest in finding better, faster and safer ways to get the job done right—without waiting years to see a tax benefit.
• No tax on overtime for American workers: Exempting overtime pay from federal income tax delivers direct, meaningful relief to the hardworking men and women of the construction trades—rewarding long hours on the jobsite.
• Expanded 529 accounts for skilled trades training: The legislation expands the use of 529 savings accounts to cover career and technical education in the skilled trades, helping the next generation of construction professionals enter the workforce without student debt.
  
  Now that this critical legislation has been signed, the construction industry can look forward to the administration building on this momentum by enacting additional reforms to reduce regulatory burdens on businesses. Smart, targeted regulatory relief will give contractors even greater ability to create jobs, strengthen their communities and drive economic growth nationwide.