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Key Takeaways The OBBBA brings significant changes to the treatment of R&E expenditures and business interest deductions, benefitting ecommerce businesses.
Proper documentation and expert CPA guidance are key to maximizing deductions and ensuring compliance with evolving tax laws.
The first criterion in an Omnisend study this summer that ranked states in terms of attractiveness when it comes to operating an ecommerce store was telling. It was taxes.
There’s no disputing that taxes can make or break you as an entrepreneur.
Back in 2016, when I launched my first ecommerce store, I had to learn this the hard way. My approach to taxes was mostly trial and error. I didn’t have a mentor yet, and I was still figuring out the basics like how to read financial documents, analyze them properly and build my own spreadsheets. I was getting better with software and tracking systems, but after a year, I realized something important: This wasn’t my strength. I needed a CPA who specialized in online businesses, someone who could guide me, especially when it came to deductions.
At the time, no one had ever explained to me how to maximize business deductions. I was only 21 or 22, still brand new to entrepreneurship, and in that first year, I learned quickly about all the expenses, especially those designated as “ordinary and necessary” by the IRS, that really add up. Even with a partner, ecommerce operators face costs like software tools, subscription fees and travel.
I want to elaborate a little on the latest developments regarding the interpretation of ordinary and necessary business expenses, which are now primarily being driven by the provisions of the 2025 One Big Beautiful Bill Act (OBBBA). The act permanently extends and modifies several relevant tax provisions from the 2017 Tax Cuts and Jobs Act (TCJA), altering the treatment of specific expenses like Research and Experimentation (R&E) and business interest.
Related: Finally, Tax Season is Over. Or Is It? Here are 5 Things You Need to Do All Year to Reduce Tax-Season Stress.
Tackling these new developments, individually:
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