New Tax Laws Ease Uncertainty – Implications for CRE Investors

Written By Marc Nicholson

New Tax Law Refresh: ​
Bonus Depreciation, Opportunity Zones, and Clarity Ahead​​​

​Familiar Rules, With Strategic Updates​

  • Retention of key commercial real estate tools like 1031 exchanges, Carried Interest, and the Qualified Business Income deduction​

  • Tax brackets unchanged, just adjusted for inflation​

  • SALT deduction raised to $40K starting 2025, phasing out over $500K income and expiring in 2030​

Opportunity Zones Get a Makeover​

  • Opportunity Zone program renewed permanently, with 5-year deferrals and 10% step-up basis​

  • New rules include stricter eligibility and redrawn census tracts​

  • Rural Opportunity Zone funds created, offering 30% step-up basis after 5 years​

Bonus Depreciation Reinvigorates Returns​

  • Permanent renewal of 100% bonus depreciation for qualifying property placed in service after Jan 19, 2025​

  • Section 179 bonus depreciation cap lifted to $2.5M for equipment/software​

  • These tools can offset negative leverage and strengthen first-year returns​

Sources: Marcus & Millichap Research Services, Internal Revenue Code § 199A; One Big Beautiful Bill Act (Sec. 12001), signed into law July 4, 2025.​

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Marc Nicholson
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