Operator Notes No. 2: Bonus depreciation is permanent now

Operator Notes from OWN Indiana, the Indiana Owner-Operator Network

NO. 2 · 9‑MINUTE READ

Tuesday, March‌ 10, 2026

Hi everyone,

Thanks for being part of OWN Indiana. A lot happened in February and early March that directly affects how you run, buy, and grow businesses in Indiana. We pulled together the most important updates below so you can act on them now, not find out about them later.

Small rooms. Real operators. Practical conversations.

February Meetup Recap

We hosted the second OWN Indiana meetup at American Legion Post 470 in Fishers. Strong turnout again with a lot of new faces.

The feedback keeps reinforcing the same thing: people have been looking for an operator-first room in Indiana that is practical, grounded, and built around the day-to-day reality of building, running, and buying businesses. That is what we are building.

Butler ETA Conference Recap

OWN Indiana has a table at the sold-out Entrepreneurship Through Acquisition Conference hosted by Butler University today. Over 360 attendees and 40 speakers. The interest in business ownership transitions in Indiana is real and growing.

If you came from the conference and want to stay connected to the year-round operator community, you are in the right place.

If you have feedback, ideas, or introductions from either event, reply to this email or reach out at [email protected].

Next Event: Operator Workshop with Colin King, CPA, CFA

Date: Wednesday, March‌ 25, 2026

Time: 3:‌00‌ PM to 6:‌00‌ PM

Location: VFW, Carmel, Indiana

Topic: Financial Fluency for Operators

Colin King of Profit Mastery will lead a 60-minute training on how to use your financials to drive better decisions on pricing, cash flow, and profit. Whether you are operating or acquiring, this session is built for people who want to make sharper decisions with the numbers they already have.

This is practical, not academic. If you have a question about margins, working capital, or cash flow, bring it. Networking before and after the training.

Registration details are on our LinkedIn page and website. Spots are limited.

Operator Workshop with Colin King, CPA, CFA

Save the Date: April Industry Night

In April, we are hosting our first Industry Night. This is OWN Indiana’s broader ecosystem event, designed for the full community: operators, buyers, lenders, brokers, attorneys, advisors, and service providers.

Most OWN meetups stay operator-first and curated. Industry Nights are where we bring the full ecosystem into the same room, on purpose and with structure. More details coming next month.

The Operator Briefing: What Changed and What to Do About It

February and early March brought major federal tax changes, state legislative wins, new SBA rules, and regulatory shifts that directly impact your business. Here is what matters most, with specific actions you should take.

TAX AND FINANCIAL WINS

100% Bonus Depreciation Is Permanent

The One Big Beautiful Bill Act made 100% bonus depreciation permanent for qualifying business property acquired and placed in service after January‌ 19, 2025. Machinery, equipment, vehicles, office furniture, computers, and even used property qualify. If you are making capital investments this year, the full cost can be deducted in year one.

What to do: Review all planned 2026 equipment purchases with your CPA. Consider accelerating Q3 or Q4 purchases into Q2 to capture the full deduction sooner. The Section 179 expensing limit also jumped to $2.56 million, giving you two overlapping mechanisms to expense major purchases immediately.

Pass-Through Deduction Jumps from 20% to 23%

The same federal law increased the Qualified Business Income deduction from 20% to 23% for pass-through entities starting in 2026. There is now a $400 minimum deduction, and the phase-in ranges expanded to $75,000 for single filers and $150,000 for joint filers. Every S-Corp and LLC in Indiana sees an immediate post-tax cash flow improvement.

What to do: Model the 2026 impact with your CPA. If you are near the phase-out thresholds, this is a good time to evaluate entity structure optimization.

Indiana Pass-Through Penalty Eliminated and State Rate Drops to 2.95%

The Indiana legislature passed SB 259, eliminating an unnecessary $500 reporting penalty for pass-through entities. That single change saves Indiana small businesses approximately $20 million annually. Combine that with the state income tax rate dropping to 2.95% for 2026, and Indiana pass-through owners are keeping more cash from multiple directions.

Indiana Tax Amnesty Window Opens July‌ 15

The Indiana Department of Revenue is running a tax amnesty program from July‌ 15 through September‌ 15, 2026. If your business has any unpaid state tax liabilities for periods ending before January‌ 1, 2023, you can settle them without interest, penalties, or civil prosecution.

What to do: Audit your state tax accounts now. If you acquired a business in the last three years and discovered inherited liabilities during post-close, this is your window to clean up the balance sheet without punitive costs. Calendar July‌ 15 as the start date.

CAPITAL AND DEAL ACTIVITY

SBA 504 Rates Hit 5.72% (5.48% for Manufacturers)

March‌ 2026 SBA 504 debenture pricing landed at 5.72% fixed for 25 years on commercial real estate and heavy equipment. Manufacturers get an additional discount because the SBA waived the annual service fee, bringing the effective rate down to 5.48%.

What to do: If you are considering real estate acquisition or equipment financing, lock these rates now. For acquisition entrepreneurs, restructure LOIs to include 504 debt where the asset mix supports it. Sub-6% fixed debt for a quarter century changes the math on every asset-heavy deal.

SBA 7(a) Loans Get New Rate Options

Effective March‌ 1, the SBA now allows lenders to use SOFR, the 5-year Treasury Note Rate, or the 10-year Treasury Note Rate as alternative base rates for variable 7(a) loans. Before this change, lenders were limited to Prime or the SBA Optional Peg Rate.

What to do: Ask your SBA lender about SOFR-based pricing before your next term sheet. Because SOFR reflects actual overnight borrowing costs, it can yield lower effective rates than Prime for certain deal structures.

New SBA Citizenship Requirements for 7(a) and 504 Loans

SBA-backed acquisitions now require that all direct and indirect owners (and SBA-required guarantors) are U.S. citizens or nationals with principal residence in the U.S. This took effect March‌ 1 with specific timing cutoffs for applications already in progress.

What to do: If SBA debt is part of your acquisition capital stack, confirm ownership structure eligibility before signing LOIs. Lenders and deal attorneys should update underwriting checklists.

Search Funds and Individual Buyers Now 27% of Lower Middle Market Deals

According to Axial data, Search Funds (14%) and Individual Investors (13%) are capturing unprecedented market share in closed transactions, particularly in the $1M to $3M EBITDA range within industrials and business services. Average total enterprise value for search fund acquisitions has surpassed $11 million.

For operators thinking about selling: the buyer pool is deeper and more diverse than ever. For buyers: this validates the model, but it also means more competition for quality assets.

COMPLIANCE AND REGULATORY UPDATES

FinCEN BOI Reporting Suspended for Domestic Companies

The Treasury Department officially suspended the Corporate Transparency Act beneficial ownership reporting requirements for U.S. citizens and domestic reporting companies. If you set up systems to comply with BOI filing, you can stand them down. The requirement now applies only to foreign entities registered to do business in the U.S.

What to do: Notify your registered agent. Stop any BOI filing prep for domestic entities. If you already filed, no further action required.

DOL Proposes New Independent Contractor Rule

The Department of Labor proposed rescinding the 2024 independent contractor rule and replacing it with an “economic reality” test anchored in two core factors: control over how the work is done, and opportunity for profit or loss. The comment period closes April‌ 28. For operators in home services, construction, logistics, and professional services who rely on 1099 workers, this is a direct classification risk.

What to do: Audit your independent contractor relationships. If a worker looks like an employee under the control and profit/loss test, reclassify before enforcement begins.

FTC Shifts to Case-by-Case Non-Compete Enforcement

The FTC abandoned its blanket nationwide ban on non-competes after federal court injunctions. But the agency is now targeting specific companies, especially in healthcare and staffing, for using restrictive covenants on lower-wage or hourly workers. Indiana operators using non-competes should review their agreements now.

What to do: Pull every active non-compete and have employment counsel review. Ensure agreements are narrowly tailored: tied to the protection of legitimate trade secrets, limited in geographic and temporal scope, and applied only to highly compensated employees.

Indiana Requires ID Verification for Business Filings

Under HEA 1593, anyone filing a biennial Business Entity Report for an LLC or Corporation must now verify their identity using approved methods. The law also creates a framework for remote businesses to use a Commercial Mail Receiving Agency as a registered contact address, which is relevant for digital-first holding companies and out-of-state funds acquiring Indiana assets.

What to do: Confirm your registered agent is compliant with the new ID verification process. If you operate remotely, investigate CMRA options for your Indiana entities.

OPERATIONS AND RISK

AI Phishing Is Real. Implement Callback Verification Now.

AI has made phishing attacks indistinguishable from legitimate emails. The messages are perfectly written, reference real vendors, mirror conversational tone, and can mimic executive voices. Spotting bad grammar in scam emails is no longer a viable defense.

What to do: Implement one rule immediately: if any email or message requests a change to money, credentials, banking info, or vendor details, the recipient must verify through a phone call to a known number. Not a reply email. Not a text. A phone call. Train your team on this before the end of the monthq.

48% of SMBs Plan Price Increases. Here Is How to Keep Customers.

Market data shows nearly half of U.S. small business leaders plan to raise prices in the next six months. Insurance costs, labor costs, and input price pressure are making it unavoidable. The Fed Beige Book specifically noted that small businesses in the Chicago district (which covers Indiana) are seeing large increases in health insurance quotes.

The businesses holding onto customers through price increases are doing three things: tiered loyalty programs with tangible rewards, CRM-driven personalization so high-value clients get targeted offers, and proactive support where frontline employees have the authority to issue immediate remedies without manager approval.

What to do: If you are raising prices, pair it with a retention investment. Start simple: call your top 20 accounts personally, offer a tiered discount for volume, and give your front-line team the autonomy to resolve issues on the spot.

Midwest Aluminum Premiums Hit $2,182 per Tonne

Sustained Section 232 tariffs pushed U.S. Midwest aluminum premiums to a record high, a 67% expansion over six months. Metal-intensive manufacturers face structural margin compression. The sector-specific tariffs remain in place regardless of broader trade policy shifts.

What to do: Manufacturing operators: renegotiate supplier contracts, explore domestic sourcing alternatives, and update downstream pricing. Buyers evaluating manufacturing targets: stress-test margins against sustained premium levels.

INDIANA GROWTH SIGNALS

The IEDC reported more than 5,700 new jobs committed to Indiana in February alone, across advanced manufacturing, defense, life sciences, and technology. Here are the highlights that matter for operators:

Meta broke ground on a $10 billion data center campus in Lebanon. Over 4,000 construction jobs at peak activity, 300 permanent roles. If you are in construction, HVAC, electrical, or logistics near Boone County, start positioning for subcontracting now.
NewCold is expanding its Lebanon facility past $800 million total investment, adding 200+ high-wage jobs. Another logistics and cold storage signal reinforcing the I-65 corridor.
Hanjung America selected Huntington for its first U.S. operation, bringing 300 jobs to support the energy storage supply chain. Northern Indiana manufacturers should watch for supplier cluster opportunities.
Resmed is investing $30 million in a distribution center in Greenwood, adding 100 high-wage jobs along the I-65 corridor.

Every major investment creates downstream opportunities for SMB service providers, commercial contractors, and local distributors. Monitor IEDC announcements and position your business as a local vendor before these operations are fully staffed.

QUICK HITS

Lawn care and pest control operators: fertilizer and herbicide application services are now exempt from Indiana sales tax when billed as a bundled service. Update your invoicing software to prevent over-collecting.
R&D expense deductibility restored: the federal mandate to capitalize and amortize domestic R&D expenses over five years has been reversed. Research and experimental expenditures are immediately deductible again. Many manufacturers do not realize that process improvements qualify.
E-Verify enforcement: Indiana SB 76 establishes strict statewide enforcement prohibiting the knowing employment of unauthorized workers. Safe harbor protections exist for employers using E-Verify. If you are in construction, logistics, or manufacturing, audit I-9 compliance now.
OSHA heat illness rule: new federal requirements for documented hydration, rest, and acclimatization protocols are coming for both indoor and outdoor work environments. Start building your plan before summer. Separate deadline: HazCom compliance (chemical labeling) is due May‌ 19.
BPP tax exemption preserved: legislative efforts maintained the $2 million business personal property tax exemption threshold, effective 2027. Nearly all Indiana small businesses remain shielded.

Key Dates

March‌ 13	NFIB Indiana End-of-Session webinar (legislative recap)
March‌ 25	OWN Indiana Operator Workshop: Financial Fluency with Colin King (Carmel, IN)
March‌ 31	Conexus Indiana Industry Exchange Workshop (Jeffersonville, IN)
April‌ 15	Indiana state/federal tax filing deadline
April‌ 22	USDA Value-Added Producer Grant applications close
April‌ 28	DOL independent contractor rule comment period closes
April‌ 28-30	Indiana HR Conference and Expo (Indianapolis)
May‌ 19	OSHA HazCom (chemical labeling) compliance deadline
July‌ 15 - Sep‌ 15	Indiana Tax Amnesty Program window

What We Want From You This Month

If you reply to this email with any of the following, it helps us build the calendar and keep the rooms high quality:

Shop visit nominations: know a business we should visit in 2026? Any industry, anywhere in Indiana.
Roundtable topics: what do you want a small-room discussion on? Pricing, hiring, cash flow, post-close, leadership?
City suggestions: where should OWN host next outside the Indy metro?
People who belong: owners, operators, founders, buyers, holdco builders who would make the room better.
Feedback: what is working and what can we improve.