We know starting the franchising process can be overwhelming. Whether you’re a business owner exploring ways to grow, or a prospect interested in owning a franchise, franchising introduces participants to a whole new world of legal procedures, brand consistency, scaling responsibilities, franchise relationships, and investments. As a franchise development specialist, FranSource will walk alongside you at every step, including leveraging legislation like the Big Beautiful Bill to relieve financial pressures.

Though the Trump Administration’s Big Beautiful Bill has faced some controversy, it’s quickly become a valuable resource for franchises in any industry. We’re diving into these opportunities and how they can help your locations flourish.

The Big Beautiful Bill Brings Big Opportunities

Like its namesake, the Big Beautiful Bill is filled to the brim with provisions that can significantly ease burdens for franchise owners. By lessening the cost to invest and operate, these reforms can encourage prospective franchisees to step into a new chapter of business ownership with your franchise.

One of the key measures in this legislation can be found in Section 199A, which outlines qualified business income (QBI) deductions. The Big Beautiful Bill permanently institutionalizes an up to 20% deduction on taxable income for “pass-through businesses.” As a qualifying business model, franchisees can rely on these funds to be available for any reinvestments or expansions toward the business. FranSource can assist in developing strategies that maximize these benefits by offsetting royalty and marketing fees and more.

The Big Beautiful Bill also codifies 100% Bonus Depreciation, which allows business owners to deduct the full cost of qualified assets within the year of purchase. In the case of franchisees, this measure eases the burden of purchasing new equipment, furniture, fixtures, technology, and other items. Now permanent, this statute gives franchisors and franchisees clearer vision in their yearly tax planning strategies.

In addition, franchises navigating expansions, remodels, and other investments with debt can benefit from increased interest deduction standards. Businesses now have the ability to deduct up to 30% of their interest expenses on earnings before interest, taxes, depreciation, and amortization (EBITDA). By easing the effects of interest, franchises can improve their cash flow without hesitations about additional borrowing.

Together, these measures reduce the pressures of internal operations for franchisors and franchisees. These operators have the ability to conduct strategic planning with certainty that legislation will be available as they determine a clear trajectory for growth.

Wait, There’s More?

Even with these operational benefits, the Big Beautiful Bill also addresses factors beyond the present-day franchise owners and operators. As an example, this robust piece of legislation provides parameters for addressing the financial implications of generational ownership. The estate tax exemption (also known as the gift tax) immortalizes the measure that transferrable assets at or below $15 million are exempt from federal taxation upon an individual’s death.

The higher threshold gives franchises more flexibility to develop a strong business succession plan. Free from waning deadlines, owners can determine the future of their franchise or franchises in a way that sets them up for success. In practice, that may look like transferring assets to a trust, directly to family members, or dictating buy-sell agreements. Whatever the chosen route, the estate tax exemption works in the best interests of your business to encourage additional investment and invite a lasting legacy for the brand.

Yet, aside from the business’ present and future situations, the Big Beautiful Bill also includes measures that ease tension for employees joining your franchise team. As the most well-known provision, the elimination of taxes on tips for those working in service sectors such as restaurants, hospitality, and salons. In these cases, employees are no longer required to report or pay federal income tax on this income.

Though state-level taxation stands (depending on your state), the increase in take-home pay will give your franchise better opportunities to hire staff, retain employees, and reduce pressure to meet rising labor costs.

Franchise Development Made Easy with FranSource

As you can see, the Big Beautiful Bill is filled to the brim with measures designed to give franchise owners the opportunity to reach their business goals. By reducing the strain of financial commitments, both in daily operations and taxation, this legislative act is poised to help numerous franchises maximize their capabilities without fear of expiration windows or excessive debt.

Even so, it’s still important to recognize that no two franchises are exactly alike. Every franchise brings its own unique set of characteristics and challenges that can affect the ways it will leverage the Big Beautiful Bill.

As franchise development specialists, FranSource has partnered with countless franchise styles across a multitude of industries. We operate as a trusted advisor to your business. Our thorough approach to franchising not only ensures you cover every developmental consideration, but also maximize available resources that can ease pressure for you and future franchisees.

When it comes to the Big Beautiful Bill, we know there are some limitations that apply. Part of the advantage behind it is adding permanence to otherwise temporary statues. Though this brings more long-term stability for strategic planning, there is a lingering possibility that these measures could shift with a new administration. Similarly, the bill’s expanded tax exemptions apply at the federal level, meaning franchises should consider any inheritance or income tax provisions that remain at the state level.

These are only some of the variable factors involved in employing benefits from the Big Beautiful Bill. Even so, businesses that partner with a trusted and experienced franchise development company like FranSource can rest assured they will have the tools, resources, and knowledge to harness the advantages of the Big Beautiful Bill.

Are you wondering how you can utilize the Big Beautiful Bill while franchising your company? Then it’s time to connect with the experts at FranSource. Contact us today to start the next chapter in your franchising journey.