Imagine unlocking a treasure chest of tax breaks that lets you reinvest in your kitchens, treat your team better, and keep more of your hard-earned money. That’s exactly what H.R. 1 - the “One Big Beautiful Bill” - does for multi-unit restaurant operators beginning January 1, 2025. Here’s what you need to know - and what to do about it - without all the accounting jargon.
1. Say Hello to 100% Write-Offs on Equipment
What changes: Any new ovens, refrigerators, dining tables or patio umbrellas you buy after December 31, 2024 can be deducted in full in the year you place them in service.
Why it matters: Instead of spreading the cost over many years, you get the entire tax break up-front, freeing up cash for more remodeling or new locations.
What to do:
• Line up those kitchen overhauls, HVAC fixes, or patio builds now.
• Talk to your accountant about a cost-segregation study to get even more deductions sooner.
2. Bigger Section 179 Deduction for Smaller Purchases
What changes: You can now write off up to $2.5 million of qualifying small equipment (think furniture, POS systems, small tools), with the limit phasing out only after $4 million in purchases.
Why it matters: Growing chains and booming independents can grab fast deductions on everyday gear, too - no need to spread those costs out.
What to do:
• Inventory your next round of small-ticket buys and tag them for Section 179 treatment.
3. Your Business Income Deduction Just Got Better
What changes: The so-called QBI deduction becomes permanent - and jumps from 20% to 23% of your taxable restaurant profits starting in 2026.
Why it matters: Lower taxable income means lower tax bills, dollar for dollar.
What to do:
• Run a quick “C-corp vs. pass-through” model with your CPA to see which structure saves you the most.
4. Tips - Now a Little Easier on Taxes (2025–2028)
What changes: Servers and bartenders can deduct up to $25,000 of reported tips from their taxable income each year, phasing out once they hit higher income levels.
Why it matters: Your team takes home more - without costing you extra in payroll taxes.
What to do:
• Update your POS and tip-reporting so those tips flow correctly onto W-2s.
• Revisit your tip-pool rules to keep things fair.
5. Overtime Pay - A New Recruiting Perk (2025–2028)
What changes: Employees can deduct up to $12,500 of overtime pay each year from their taxable income.
Why it matters: Offering overtime suddenly feels sweeter to kitchen staff - and it’s a story you can use in recruiting.
What to do:
• Make sure your timekeeping and payroll systems are ready to track overtime separately.
6. Interest Deductions Get a Boost (2025–2028)
What changes: The bill lets you deduct interest on up to 30% of your earnings before interest, taxes, depreciation and amortization (EBITDA) - a friendlier test than before.
Why it matters: Financing big remodels or new builds with loans is more advantageous - your interest costs are more fully deductible.
What to do:
• Talk to your lender about locking in fixed-rate debt now.
• Revisit sale-leaseback strategies while this rule is in effect.
7. Meals for Staff - Back on the Menu
What changes: Shift meals you sell to your team at a fair price are fully deductible again.
Why it matters: That daily staff meal just became a legitimate business expense - no more guesswork.
What to do:
• Ring up those shift-meal charges like any other menu item.
• Keep your receipts tidy and separate from entertainment or client meals.
Heads-Up: Tariffs Are a Separate Story
In March 2025, a 25% duty was placed on many food imports from Mexico, Canada, and other countries. Plan to bump menu prices by 3–4% if your produce costs jump when tariffs go into effect.
Quick-Look Chart
Your Move: Operator Checklist
- Lock in big projects now. Get those ovens and HVAC systems in service in 2025 for full write-off.
- Model your entity choice. Compare C-corp vs. pass-through savings with fresh numbers.
- Upgrade payroll and POS. Ensure tips and overtime are tracked, reported and deducted properly.
- Refinance or secure loans. Take advantage of the friendlier interest-deduction rules.
- Plan for tariffs. Factor in a small price bump to protect your margins.
Bottom Line
The big, beautiful bill hands restaurant owners a rare opportunity to supercharge growth, upgrade kitchens, and reward teams - with real tax savings to match. Act fast, because some perks only last through 2028. The clock is ticking - get ready to reinvest, refresh and reap the rewards.
