2026 Mid-Year Tax Review: OBBBA, QBI, and Key Planning Moves
Half the year is gone. If you haven’t reviewed your tax position since filing, you’re already behind.
Mid-year is the most underutilized point in tax planning. Returns have been filed, the urgency of April has faded, and Q4 feels far away. That’s exactly why business owners who are serious about protecting their income use this time to do something most of their peers won’t: a structured mid-year tax review.
A 2026 mid-year tax review for business owners matters more than usual because OBBBA changes may affect QBI, depreciation, credits, and estimated payments. The One Big Beautiful Bill Act (OBBBA), signed into law on July 4, 2025, introduced sweeping permanent changes to the tax code. These changes create real savings opportunities for pass-through business owners, but only if you know they exist and plan around them.
This checklist covers what to review right now, what has changed under the OBBBA, and what business owners may be overlooking.
Why a 2026 Mid-Year Tax Review for Business Owners Matters Now
Tax preparation looks backward. Tax planning looks forward. Mid-year is the last practical point in the year where you have enough runway to implement meaningful strategies before year-end.
By the time Q4 arrives, your options narrow. Major purchases, retirement contributions, entity structure changes, and income-timing decisions all require lead time. A mid-year review creates the space to act intentionally, rather than scrambling in December.
Checklist Item 1: Revisit Your QBI Deduction Eligibility
The OBBBA made the Qualified Business Income (QBI) deduction permanent and expanded the income phase-in ranges for pass-through owners, including LLCs, S-Corps, sole proprietors, and partnerships.
The deduction rules have also been enhanced for 2026. Importantly, the expanded phase-in ranges mean some owners who were previously phased out may now partially or fully qualify.
What to do now: Pull your year-to-date profit and project full-year income. If you are near a phase-out threshold, there may be strategies such as retirement contributions, timing of distributions, or expense acceleration that keep more of your deduction intact. Don’t assume last year’s calculation still applies.
Checklist Item 2: Review Your Bonus Depreciation Timing
Bonus depreciation was restored to 100% permanently under the OBBBA. Any qualifying equipment, vehicles, machinery, or certain building improvements purchased in 2026 can be fully deducted in the year of purchase, not depreciated over five or seven years.
What to do now: Review your planned capital expenditures for the rest of 2026. If you have been deferring a major purchase, this is the year to revisit that decision. The deduction is now both permanent and immediate. For a broader look at how tax planning supports growth, cash flow, and reinvestment, read our guide on tax strategy for business growth.
Checklist Item 3: Check Your Estimated Tax Payments
With the QBI deduction expanded and bonus depreciation restored, your taxable income projection may look meaningfully different from last year. If you are basing estimated payments on prior-year figures without adjusting for 2026 changes, you may be overpaying, or underpaying and heading toward a penalty.
What to do now: Have your CPA run a revised income projection based on your actual year-to-date financials. Your Q3 and Q4 payments can still be adjusted before the September deadline.
This is also where forward-looking financial guidance matters. Learn how virtual CFO services can help business owners forecast cash flow, model tax exposure, and make better planning decisions.
Checklist Item 4: Evaluate Your Retirement Contribution Strategy
Retirement contributions reduce current-year taxable income and interact directly with your QBI calculation. Most business owners are not contributing at the level their income and plan type allow.
With the QBI deduction now permanent and enhanced, the relationship between retirement contributions and your effective tax rate deserves a fresh look.
What to do now: If you haven’t revisited your contribution level or plan structure since the OBBBA passed, now is the time. Some plan types require setup before year-end to qualify for a current-year deduction.
Checklist Item 5: Review Your Entity Structure
Entity structure is one of the most consequential tax decisions a business owner makes, and the least frequently revisited. With permanent changes now in place, the calculus around S-Corp elections, LLC treatment, and pass-through structures has shifted.
Whether you are structured optimally depends on your current income level, owner compensation, and long-term goals.
What to do now: If your revenue has grown significantly, or if you haven’t had a formal entity structure conversation with your CPA in the past two years, schedule one. The right structure can affect thousands of dollars in annual tax exposure.
Checklist Item 6: Don’t Overlook the New Employer Credits
The OBBBA made employer credits for childcare and paid family leave permanent and more valuable. If you have employees and offer these benefits, there is a meaningful tax incentive now built into the law that many owners have not yet claimed.
What to do now: Ask your advisor whether your current benefit offerings qualify. If you have been on the fence about adding paid leave policies, the credit structure may make the decision clearer.
How BTO CPA Can Help With Your Mid-Year Tax Review
The real value of a mid-year tax review for business owners is not checking boxes. It is replacing uncertainty with a clear picture of where you stand, what you can still control, and how to move toward year-end with fewer surprises.
At BTO CPA PLLC, our Tax Strategy & Planning services help business owners review compensation, QBI eligibility, entity structure, estimated taxes, and cash flow together, not in silos. Each decision affects the others, and mid-year is when business owners still have time to act before year-end options close.