TAXES AND OBBB: TURNING CHANGE INTO OPPORTUNITY The One Big Beautiful Bill Act (OBBB), signed in July 2025, has rewritten the tax playbook for manufacturers. There’s a lot to unpack, but here are the highlights: 100% capital expensing is back via bonus depreciation and section 179, and manufacturers can now write off qualified manufacturing facilities. In addition, domestic R&D expenditures can be deducted immediately, again, and small manufacturers get retroactive relief on prior-year R&D amortization. These changes open the door for accelerated investments and a more competitive edge. But there’s a catch — state-level conformity to OBBB isn’t uniform. Some states are rolling with the changes, others are sticking to old rules, and a few are picking and choosing. If you operate across state lines, now’s the time to team up with your advisors and make sure you’re getting the most out of these new opportunities. REGULATORY OUTLOOK: STAYING AHEAD OF THE CURVE Regulations are evolving, and manufacturers must remain adaptable. Section 232 investigations are expanding beyond the usual suspects — steel and aluminum — to include pharmaceuticals, wood and timber, and industrial machinery. This broader focus means vigilance is more important than ever. Keep an eye out for energy tax credit phase-outs and court decisions that could reshape tariff authority. The regulatory environment is dynamic, and agility will be key to navigating what’s next. ECONOMIC CORNER THE POWER OF DATA: YOUR SECRET WEAPON Let’s not forget the power of data and technology. More manufacturers are leveraging their own internal data, alongside external sources, to refine margins and make more informed decisions. For example, insights from Wipfli’s internal data source have revealed shifts in demand and labor availability ahead of what’s reported in public datasets, helping manufacturers spot trends as they unfold rather than waiting for lagging indicators. Digital strategy isn’t just a buzzword; it has become the backbone of operational success, enabling organizations to respond quickly to market shifts and stay ahead of the curve. By combining internal insights with broader market data, manufacturers can develop a more nuanced perspective — one that supports confident decision-making, even when the external environment feels uncertain. CONCLUSION: THRIVING IN A YEAR OF CHANGE 2026 is shaping up to be a year of cautious optimism, driven by stabilizing economic indicators, evolving trade agreements, transformative tax policy, and a dynamic regulatory environment. Success won’t come from standing still; it will come from staying agile, planning, and leveraging data and technology to their fullest potential. So, what’s next? Begin with scenario planning, supply chain audits, and tax strategy reviews. Informed and adaptable manufacturers can thrive during times of uncertainty. CARA WALTON leads Wipfli’s manufacturing market intelligence service, overseeing its strategic growth, data acquisition, and intelligence gathering. Contact her at cara.walton@ wipfli.com. MIKE DEVEREUX serves as Wipfli’s National Manufacturing Leader. He focuses his time advising middle-market manufacturing companies across the country. Contact him at mike. devereux@wipfli.com. The ups and downs of 2024 and 2025 have tested our resilience, but they’ve also set the stage for a year that feels different — full of promise for those willing to adapt and think ahead. WWW.ARPMINC.COM / 15
RkJQdWJsaXNoZXIy Nzc3ODM=