Real estate investors are watching Congress closely. A recently introduced tax bill, informally dubbed the “One Big Beautiful Bill Act” (OBBBA), aims to extend and enhance tax provisions essential to investors. Let’s unpack what’s in play—and how it could directly impact investors in Georgia:
🔹 What’s Inside the New Tax Bill?
- Extension of 100 % bonus depreciation through 2030
Previously phasing out, bonus depreciation lets investors immediately expense the full cost of qualified property improvements—for example, Roofs, HVAC, appliances—accelerating tax deductions and boosting cash flow. biggerpockets.com - Extension of the 20 % pass-through deduction (IRC §199A)
Beneficial for LLCs and S-corps (common among Georgia’s real estate investors), this deduction allows up to 20 % write-offs on qualifying business income. biggerpockets.com - Increase in the SALT (state/local tax) deduction cap to $30,000
With Georgia’s property taxes rising, this move could put more money back in investor pockets—especially impactful for those with rental properties. biggerpockets.com
🔹 Why This Matters for Georgia Investors
- Boosted Cash Flow & Depreciation
Immediate expense of capital improvements equals major upfront tax savings—ideal for Georgia investors managing rehab or short-term rental (STR) properties. - Lowered Effective Tax Rates
Thanks to the 20% pass-through deduction, LLC-based rental operations retain more profits, which can be reinvested into additional Georgia real estate. - Incentive to Buy or Upgrade
A higher SALT cap means less out-of-pocket tax—encouraging investors to acquire or enhance properties in high-demand Georgia markets like Atlanta, Augusta, Columbus, and coastal areas.
🔹 Points of Caution
- Deficit concerns: Critics warn the extensions may significantly increase the national deficit—something to monitor, though unlikely to hamper the current proposal. biggerpockets.com
- No changes to 1031 exchanges: Existing rules remain in effect, leaving tax-deferred exchange strategies unchanged. biggerpockets.com
🔹 Georgia Investor Strategy: What You Can Do Now
| Step | Action |
|---|---|
| 1️⃣ | Plan Expedited Improvements – Position renovations to qualify under bonus depreciation before deadlines. |
| 2️⃣ | Evaluate Ownership Structures – Confirm your pass-through eligibility and optimize your Georgia rental business setup. |
| 3️⃣ | Factor in Tax Savings – Higher SALT deductions and bonus depreciation should be reflected in purchase budgets and cash flow projections. |
| 4️⃣ | Consult Your Advisor – Georgia investors should discuss timelines and eligibility with their CPA and real estate counsel. |
Final Thoughts
The OBBBA offers some powerful incentives for Georgia real estate investors—particularly those holding rental portfolios or working on property improvements. Extended bonus depreciation, pass-through deductions, and increased SALT caps can enhance cash flow, lower tax burdens, and increase profitability.
Want to leverage these benefits in Georgia? Reach out to:
JNL Smart Realty Contact Information: Jerry Cohen: (678) 975-0441 | Jerry@jnlsmartrealty.com Nadav Akselrad: (937) 654-2676 | Nadav@jnlsmartrealty.com Website: www.jnlsmartrealty.com