Payroll professionals, take note: A proposed federal initiative known as the One Big Beautiful Bill (OBBB) is generating buzz across the compliance and tax landscape—and for good reason. This sweeping legislation could drastically reshape how employers handle payroll reporting, employee classification, and multi-state compliance.
At Aatrix, we’re keeping a close watch on these potential changes to ensure our customers are informed and ready. Here’s what you need to know.
What Is the One Big Beautiful Bill?
The One Big Beautiful Bill is a legislative proposal aimed at streamlining and unifying payroll tax reporting requirements across federal and state levels. Currently, businesses must navigate a maze of conflicting rules and forms depending on where they operate. This bill promises to consolidate those processes into one standardized framework.
For payroll teams, this would reduce redundancy but require system and process updates to stay compliant.
5 Key Ways the One Big Beautiful Bill Impacts Payroll
1. Standardized Payroll Reporting Across States
Under OBBB, wage and tax data would follow a single, unified format, making it easier to file across jurisdictions. Employers operating in multiple states could see significant time and cost savings—but will also need to ensure their payroll systems can support this change.
2. Increased Reporting Frequency
The bill may introduce more frequent reporting (bi-weekly or weekly) for larger employers to enhance real-time oversight. While payroll cycles may not change, the volume of reporting could increase, requiring automation or integration with tax reporting software.
3. New National Worker Classification Rules
OBBB also proposes a standardized federal definition for independent contractors vs. employees, aiming to eliminate gray areas between IRS and state rules. This could affect who appears on your payroll, eligibility for benefits, and how taxes are withheld.
4. Simplified Tax Credit Reporting
The bill seeks to centralize how companies claim federal tax credits, such as those for hiring veterans or operating in opportunity zones. A single portal would replace multiple overlapping forms and agencies.
5. Greater Employee Transparency
Employees would be able to view their own wage history, tax withholdings, and benefits in real time through a national online portal. This creates new expectations around data accuracy and payroll visibility.
What You Can Do Now
While the bill is still moving through the legislative process, here are four steps you can take to prepare your payroll team:
- Audit your payroll systems – Ensure your software is flexible enough for frequent and multi-jurisdiction reporting.
- Talk to your provider – Aatrix customers should watch for product updates and feature releases aligned to OBBB requirements.
- Review worker classification – Now is the time to evaluate your contractor and employee policies.
- Stay informed – Follow updates from Aatrix to stay ahead of payroll compliance changes.
Aatrix Has You Covered
Whether it’s electronic W-2 filing, 1099 reporting, ACA compliance, or staying ahead of emerging legislation like the One Big Beautiful Bill, Aatrix is committed to making compliance simple. We’ll continue to monitor the bill’s progress and provide updates as new developments arise.