Navigating Business Challenges in 2025: Tax Changes, Reporting Requirements, and What You Need to Know
Source: McKonly & Asbury
The path businesses have been forced to take over these past few years has been anything but predictable. There have been detours to nowhere, road closures, gridlock, sudden mirages of smooth sailing – and the occasional sinkhole. It’s been nothing short of a mix between National Lampoon’s Vacation and Planes, Trains, and Automobiles.
I would love to tell you that the end is near. If I did that, I’d be lying. What businesses are facing right now is another year of (at least potential) changes, both from an income tax standpoint and a general business reporting standpoint.
Tax Cuts and Jobs Act
First up is the elephant in the room: the Tax Cuts and Jobs Act, which largely took effect in 2018 and is set to have its individual income tax provisions expire. This includes lower rates overall, larger rate brackets, an increased standard deduction, elimination of personal exemptions, the QBI deduction, the SALT cap, and an increased estate tax exemption (among other things). These items are all set to expire at the end of 2025. With the exception of the SALT cap and the personal exemptions, each would increase your tax liability.
What should be done isn’t terribly complicated. It’s how to get it done that is the issue. Even with a single party-controlled government, there are safeguards in place to prevent perpetual material increases in the budget deficit which requires 60 votes to pass. No party holds 60 votes, so there will have to be some serious bargaining going on, along with some serious spending cuts – the details of which are anyone’s guess.
Financial Crimes Network BOI Reporting
Second is required reporting. The Financial Crimes Network BOI (Beneficial Ownership Information) reporting is currently on hold but could come back at a moment’s notice. If businesses haven’t filed already, it’s important to understand the requirements, as the penalties are pretty hefty.
Commonwealth of Pennsylvania Required Reporting
Part 2a on the required reporting front is mandated business reporting by the Commonwealth of Pennsylvania. Beginning in 2025, all businesses and organizations doing business in Pennsylvania are required to submit an annual report, which must include the following:
- Business name
- Jurisdiction of formation
- Registered office address
- Principal office address
- Name of at least one governor (director, member, partner, etc., depending on type of association)
- Names and titles of the principal officers, if any
- Entity number issued by the Pennsylvania Department of State
The fee for the new Annual Report is $7 for business corporations, limited liability companies (LLCs), limited partnerships (LPs), and limited liability general partnerships (LLPs), with a $0 fee for nonprofit corporations and any LPs or LLCs with a not-for-profit purpose.
The first deadline to file is June 30th – which will be here before you know it.
Tariffs
Now’s the part where we get to the complete unknown – the biggest headline of which is Tariffs. The idea (at least what’s been floated publicly) is that Tariffs will serve to fill funding gaps in the budget. When you dig a little bit into how Tariffs work, it’s difficult to see how this would work. Nonetheless, it’s another potential change point in our economy.
So, buckle up because as Heraclitus always said, “The only constant is change…” or something to that effect.
Stay ahead of the curve in 2025! Make sure your business is prepared for upcoming tax changes and new reporting requirements. Review your filing obligations today and consult with a professional to ensure you’re fully compliant. As always, please do not hesitate to contact us if you have thoughts or questions about the information outlined above; our seasoned and experienced tax professionals are always here to help. You can also learn more on our Tax services page.
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