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HR110

Small Business Prosperity Act of 2025

Last scannedAug 23, 2026, 4:15 AM

In one sentence

This bill makes a business income deduction permanent, increases its size, removes limits on who can use it, stops taxing changes in corporate structure if ownership stays the same, and eliminates federal estate taxes.

Makes the qualified business income deduction permanent by removing its expiration date.
Increases the deduction amount to 43 percent for years starting after December 31, 2025, and to 47 percent for taxable years beginning after that date.
Removes limits based on wages paid or specific types of service businesses so more trades can claim the full deduction.
Stops taxing changes in a corporation's legal structure if ownership interests and assets stay mostly the same.
Repeals chapter 11 of the tax code to eliminate federal estate taxes for deaths after December 31, 2024.

Owners of qualified trades or businesses who file income taxes.
Partnerships and S corporations that pass business income to owners.
Corporations changing their organizational structure without selling assets or ownership interests.
Heirs receiving property from estates where the person died after December 31, 2024.

The bill has not been passed by Congress and is currently waiting in a committee.
The text does not explain how much money this change will save taxpayers or cost the government.
Rules for businesses with income from Puerto Rico are updated, but specific details depend on other tax laws.

Plain language

Qualified Business Income: Income earned by a business that is not paid as wages to an employee.
Deduction: An amount subtracted from total income before calculating how much tax must be paid.
Estate Tax: A federal tax on the transfer of property when a person dies.

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