Sheikh Osher & Scott CPAs & Advisors

Before OBBBA: Section 179 limit at $1.16M for 2024.

After OBBBA: Section 179 limit at $2.5M, with phase-out starting at $4M (effective 2025 and indexed forward).

For equipment-heavy businesses (practices, manufacturers, contractors, professional services), this is a significant expansion.

Section 179 plus 100% bonus depreciation (also permanent under OBBBA) gives most businesses the strongest immediate expensing toolkit in recent memory.

If you are planning capital expenditures in 2026, the timing, structure, and order of purchases matters. Run the numbers with your CPA before signing the invoice.

What is UBIT, and who owes it?

Tax-exempt does not mean tax-free. The surprise usually lands mid-audit.

Unrelated Business Income Tax (UBIT) applies to nonprofits that earn income from activities unrelated to their exempt mission.

Who owes it:

→ Nonprofits with rental income from debt-financed property
→ Nonprofits earning advertising revenue (newsletter, website, or event sponsorships)
→ Nonprofits selling merchandise unrelated to their mission
→ Nonprofits running a regularly carried-on trade or business outside their exempt purpose

What you owe:

If gross UBI is $1,000 or more in a tax year, you file Form 990-T. That is the threshold, not a suggestion. For calendar-year organizations, the filing deadline is May 15 of the following year.

Even if you owe no tax after deductions, the filing itself is required. Skip the filing and you have a compliance issue on the record.

If you are not sure whether a revenue stream qualifies, that is the conversation to have before the IRS asks the question.

Half the year is gone. The decisions you make now shape your April tax position more than anything you will do in November.
This week:

→ Compare YTD income to last year. Significant variance means estimated payments need adjusting before September 15.
→ Review your QBI deduction position — it is permanent at 20% under OBBBA, but the phase-in thresholds and phase-out math change every year with inflation.
→ Confirm bonus depreciation purchases were placed in service properly. Documentation timing matters.
→ Review your Section 179 utilization against the $2.5M limit. Equipment-heavy businesses often leave deductions on the table.
→ Project Q4 tax exposure and start year-end planning conversations now.

Proactive beats reactive every time at this stage of the year.

We are halfway through 2026.
Here is what six months of working with nonprofits, CHCs, and growing businesses has reinforced:
Organizations that invest in financial systems early spend less on compliance later. The clients with the cleanest audits are not the ones with the simplest finances. They are the ones who close books monthly and address issues in real time.
The line between bookkeeping and strategic finance is disappearing. More clients are asking for dashboards, forecasting, and scenario modeling alongside monthly financials. They want to see where they are going, not just where they have been.
Communication matters as much as competence. The most common complaint we hear from new clients about their previous CPA is not that the work was wrong. It is that they could not reach anyone.
Grateful for every organization that trusts us with their financial health.