The full version of this article appears in the August 2022 issue of TRENDreport.
For the first time in many years, there is little happening at the federal level with respect to taxes. The proposed Build Back Better legislation has been stalled in Congress and the outlook for passage in its current form is murky at best. As a CPA having to deal with multiple rounds of tax law changes in the last four years, it is a welcome relief.
However, there is one change ahead that will affect real estate investors. Bonus depreciation which has been widely used by the real estate industry to accelerate tax depreciation, will be reduced from 100% to 80% in 2023. Therefore, some investors might want to push closings of real estate purchases before year-end. Further, tax-saving cost segregation studies should be performed sooner rather than later.