Recent federal tax reforms signed into law by President Trump are set to bring significant changes for real estate professionals, property investors, and homeowners alike. The legislation, supported by the National Association of Realtors (NAR), includes several key provisions that aim to create long-term financial stability across the housing market.

Here are the major tax updates that could impact you:

✅ Qualified Business Income Deduction (QBI) Now Permanent:
Real estate agents operating as independent contractors or small businesses can continue to deduct up to 20% of qualified business income under Section 199A. This permanent extension ensures ongoing tax savings for many in the real estate industry.

✅ SALT Deduction Cap Temporarily Increased:
Starting in 2025, the state and local tax (SALT) deduction cap will rise from $10,000 to $40,000. This increase will be in effect through the 2029 tax year. In 2030, the cap will return to the $10,000 limit. This change may bring meaningful relief to property owners in high-tax states.

✅ Section 1031 Like-Kind Exchanges Remain Intact:
The new law preserves the ability for real estate investors to defer capital gains taxes using like-kind exchanges. This provision is vital for investors looking to upgrade or diversify their property portfolios.

✅ Mortgage Interest Deduction Made Permanent:
Homeowners can continue to benefit from the mortgage interest deduction—one of the most important tax incentives for homeownership. This measure reinforces the long-term value of owning real estate.

Why It Matters:
These updates not only protect key tax benefits but also help boost confidence among homeowners, investors, and industry professionals. Whether you're buying, selling, or investing in property, understanding these changes can help you plan more strategically.

Published July 2024 | Source: National Association of Realtors (NAR)