OBBBA Is Now Law: What Real Estate Owners, Developers, and Investors Should Know

The One Big Beautiful Bill Act (OBBBA) was just signed into law, bringing major tax changes.

While the bill affects many industries, real estate stands out with some of the biggest opportunities — and a few deadlines to watch.

Here’s what you need to know:

The Big Wins for Real Estate

Permanent 20% tax deduction for pass-through businesses

If you operate through a partnership, LLC, or S corporation, you can now count on this deduction long-term. That means more certainty in planning and structuring your business.

Immediate write-offs for property improvements and equipment

Updates to bonus depreciation and Section 179 expensing mean you may be able to write off renovation costs and certain property upgrades right away instead of waiting years. This can free up cash and make big projects more affordable.

Easier interest deductions starting in 2025

Rules around deducting interest expenses are loosening again, which is good news if your projects rely on financing. This should make leveraged deals more attractive.

A stronger Opportunity Zone program

Opportunity Zones are now permanent, with new benefits for rural areas. Starting in 2026, new zones will open in cycles, and rural projects will get extra incentives, including bigger tax savings after just 5 years.

Expanded credits for affordable housing & community projects

REITs get more flexibility to diversify holdings. The Low-Income Housing Tax Credit (LIHTC) program is strengthened with higher credit allocations and easier qualification for certain projects. The New Markets Tax Credit is now permanent, helping long-term neighborhood development deals.

Deadlines to Watch

Energy efficiency tax breaks are phasing out after June 30, 2026. If you’re planning upgrades like energy-efficient lighting, HVAC, or residential construction, it may pay to move quickly before these incentives expire.

What Didn’t Change

Some high-profile tax rules stayed the same:

• 1031 like-kind exchanges remain untouched.

• The carried interest rules and SALT cap workaround are unchanged.

• The limit on excess business losses is now permanent, but no stricter than before.

Bottom Line

OBBBA delivers new tools for real estate owners, developers, and investors to improve cash flow, reduce taxes, and expand into new areas — but timing is critical. Some opportunities are permanent, while others expire soon.

Next step: Now is the time to review your project pipeline and financing strategy to see where you can capture the biggest benefits.

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This is not an offer or solicitation to buy or sell any securities. 

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Some of the risks related to investing in commercial real estate include, but are not limited to: market risks such as local property supply and demand conditions; tenants’ inability to pay rent; tenant turnover; inflation and other increases in operating costs; adverse changes in laws and regulations; relative illiquidity of real estate investments; changing market demographics; acts of God such as earthquakes, floods or other uninsured losses; interest rate fluctuations; and availability of financing. Investments in real estate or real estate securities are not guaranteed and have the potential to suffer losses.

This site provides brief and general description of certain tax strategies including Opportunity Zones, Sections 1031, 1033, and 721 Exchanges. There are various risks related to purchasing securities as part of any planning strategy, including tax complexity, illiquidity and restrictions on ownership and transfer. RCX Capital Group and its representatives do not provide Tax Advice. Because each prospective investor’s tax implications are different, all prospective investors should consult with their tax advisors.