5 Tax Changes Houston Small Business Owners Need to Act On Right Now
If you’ve been putting off a tax strategy review, 2026 is the wrong year to wait. The federal tax landscape shifted dramatically when the One Big Beautiful Bill Act (OBBBA) was signed into law in 2025, and the effects are hitting Houston small business owners right now.
Some of these changes are real opportunities. Others are quiet traps for the unprepared. Either way, knowing what changed is the first step to making sure your business keeps more of what it earns.
If you want a complete picture of what your Houston business can deduct this year, we put together a full guide here. But if you want to know what’s new and what requires action before December 31, keep reading.
1. The QBI Deduction Is Now Permanent. Stop Planning Around an Expiration Date.
For years, pass-through business owners in Houston lived with a frustrating reality: the 20% Qualified Business Income (QBI) deduction was set to expire, which made long-term tax planning feel like guesswork.
That uncertainty is gone. The OBBBA made the QBI deduction permanent, which means sole proprietors, partnerships, and S-corp owners can finally build a real tax strategy around it.
The catch is that income thresholds and limitations still apply, especially for service-based businesses in fields like consulting, health, and yes, accounting. If your revenue has grown significantly this year, the phase-out range is something to watch closely with your CPA. Getting your entity structure right around this deduction can make a meaningful difference in what you owe.
2. 100% Bonus Depreciation Is Back and Permanent
100% bonus depreciation is now permanent, and it is one of the most actionable changes for Houston small business owners. If you purchased equipment, vehicles, or qualifying property in 2026, you can deduct the full cost this year rather than spreading it across multiple years.
This matters most for construction, oil and gas service, medical, and restaurant businesses, all industries common here in Houston. If a major equipment purchase is on your radar before December 31, the timing of that decision has real tax consequences. A quick conversation with your CPA now is worth far more than a surprise in April.
Our small business accounting services include proactive planning around exactly these kinds of decisions, not just filing after the fact.
3. Texas Just Quietly Raised the Business Personal Property Tax Exemption to $125,000
This one flew under the radar for a lot of Houston business owners, and it is one of the most impactful Texas-specific changes in recent memory.
Texas House Bill 9, effective January 1, 2026, raised the business personal property tax exemption threshold from $2,500 to $125,000. That means equipment, furniture, tools, vehicles, and other tangible business assets under that threshold are no longer subject to local property tax assessment.
For small and home-based businesses across Houston, this is real, immediate savings. Many owners had no idea how much of their balance sheet was subject to local property tax until a higher assessment showed up. If you have not revisited your business personal property tax filings for 2026, now is the time.
4. 1099 Reporting Thresholds Changed. Your Vendor Records Need a Checkup.
Starting in 2026, the filing threshold for 1099-MISC and 1099-NEC forms increased from $600 to $2,000. On the surface that sounds like less paperwork, but the practical risk is that looser thresholds can lead to sloppy vendor records, and sloppy records create problems when you need to substantiate deductions.
The 1099-K threshold for payment processors stayed at $20,000 and 200 transactions, reversing what had been expected to drop all the way to $600. That is a relief for many business owners who were bracing for a flood of forms.
The action item here is simple: make sure W-9s are on file for the vendors you pay regularly, and confirm your bookkeeping reflects actual payment amounts. Year-end cleanup is always harder than staying current throughout the year. If your books need attention, our bookkeeping services are built specifically for Houston small businesses that want to stay clean and compliant.
5. Business Interest Deductions Got More Generous
The OBBBA restored EBITDA-based limits for business interest deductions, replacing the more restrictive EBIT-based calculation that had been in place. In plain terms, a larger portion of your interest expense may now be deductible.
If your Houston business carries debt for operations, equipment financing, or commercial real estate, this change could lower your taxable income without any dramatic restructuring on your part. Capital-intensive businesses benefit most, but any business with meaningful financing costs should run the numbers.
The Window to Act Is Now, Not in April
2026 is one of the more stable and, in many ways, favorable tax environments small business owners have seen in years. But favorable does not mean automatic. The deductions and savings available right now require proactive planning, clean books, and in many cases the right entity structure going into the new year.
The business owners who benefit most from these changes are the ones who have those conversations before December 31, not the ones scrambling during tax season.
Jones CPA Group has been helping Houston small businesses understand their numbers and make smart financial decisions since 2011. If you want to walk through how these 2026 changes apply specifically to your business, let’s talk.
