Real Estate, Taxes, and a Bill That Actually Makes Sense
Some good news — and I don’t say that lightly.
The House just passed a major tax bill packed with real estate wins. It still has to get through the Senate, but even as-is, it’s worth a closer look. If you own property, work in real estate, invest, or just hope to buy one day, this one matters.
The (somewhat ridiculously named) One Big Beautiful Bill Act includes several updates that could make buying, selling, and holding onto real estate a little more stable — and a little less financially brutal.
Here’s what’s in it:
Mortgage Interest Deduction (MID) - Still here. Still critical. Still the #1 tax benefit for most homeowners. There was chatter about cutting it — that’s not happening.
State and Local Tax (SALT) Deduction - The cap jumps from $10K to $40K for households earning under $500K. That’s especially relevant in high-tax cities like San Francisco, where property and income taxes alone can break that threshold.
Qualified Business Income Deduction (QBI) - Real estate professionals, take note: the 20% deduction for independent contractors bumps up to 23% — and becomes permanent. That’s real money for the many of us working under 1099s.
Child Tax Credit - Increases to $2,500 through 2028, then gets indexed to inflation. Helpful for families trying to stay rooted in The City.
Affordable Housing & Opportunity Zones - The Low-Income Housing Tax Credit gets expanded, and Opportunity Zones are renewed and revised — ideally bringing investment to neighborhoods that need it most (if handled well).
Estate Tax Threshold - Locked in at $15 million, with inflation adjustments. A big deal for long-time SF families with highly appreciated real estate and a desire to pass something down. (But don’t forget to factor in Prop 19 and how that might affect your estate planning.)
1031 Exchanges - No changes. They’re safe — for now. Still a critical tool for real estate investors who want to defer capital gains tax by exchanging properties.
More financial predictability. Key deductions preserved. A little less pressure.
SALT relief and a stable mortgage interest deduction keep buyer confidence strong — especially in high-cost markets like The City.
For agents, the QBI bump is no joke. That’s real money for most of us working independently. Add in 1031 protections and solid investor incentives, and you’ve got a bill that supports activity.
For families? Between the expanded child tax credit and new investment accounts that can be used for down payments down the line, this bill actually feels… forward-looking.
It’s not law yet. The Senate still has to weigh in. But if this holds? It’s one of the more rational, housing-positive pieces of legislation we’ve seen in a long time.
This stuff doesn’t need to be confusing. If you’re wondering how this might affect your next move — or your big picture — reach out. I’m good at this part.