The One Big Beautiful Bill Act (OBBBA) brings important changes to business tax and reporting rules, especially for employers and payroll-management companies, advises DunlapSLK, a CPA and business advisory firm based in Chalfont.
First, beginning in 2026, businesses will face higher reporting thresholds for certain payments. The previous threshold — $600 in many cases — will increase to $2,000 for payments such as salaries, rents, premiums, annuities, fixed or determinable income, and payments for services. This indexable threshold will ease filing burdens for businesses that make smaller payments to contractors or service providers.
Second, for the period from 2025-2028, the OBBBA introduces new deductions for employees receiving “qualified tip income” and “qualified overtime income.” Since these are deductions (not income exclusions), such income remains subject to federal income tax withholding and payroll taxes. For 2026, the draft of Form W‑2 already includes new reporting codes: “TP” for qualified cash tip income, “TT” for qualified overtime income, and “TA” for employer contributions to “Trump Accounts” (a newly introduced account type). Box 14b of the form adds an employee-occupation field for tip-earning employees.
The IRS announced there will be no changes for tax year 2025 in individual information-return forms, payroll-tax returns, or withholding tables — meaning employers still use existing forms for the current year.
DunlapSLK can help you stay informed on any developments that will affect your business’s reporting requirements.
