ARTICLE | November 11, 2025
The One Big Beautiful Bill (OBBB) has permanently extended the Qualified Business Income (QBI) deduction and Opportunity Zones (OZs)—creating unprecedented opportunities for real estate owners, developers, and investors to reduce tax liabilities and defer gains.
Turn Your Rental Properties into Tax-Saving Machines
To maximize QBI benefits, your rental activities must qualify as a legitimate trade or business. This requires meeting specific safe harbor requirements:
- Maintain separate books and records for each property.
- Document at least 250 hours of rental services annually.
- Keep detailed activity logs.
Even triple net lease properties can qualify when strategically grouped together.
Opportunity Zones: Your Permanent Tax Shelter
The permanent extension of OZs under OBBB revitalizes this powerful strategy. Unlike 1031 exchanges, you only need to reinvest the gain amount—not the entire proceeds—and can defer gains from any asset type, not just real estate. With flexible 180-day investment windows and potential tax-free growth, OZs offer unmatched versatility.
The beauty of OZs is their flexibility: sell stock, business interests, or other assets and strategically defer gains while supporting community development—a true win-win.
Take Action Now
With these provisions now permanent, long-term tax planning becomes more predictable and powerful. Whether you’re managing existing properties or planning new acquisitions, implementing the right strategy is crucial to maximize benefits.
Ready to optimize your real estate tax strategy? Contact KHA today to schedule a consultation with our real estate tax specialists. We'll analyze your portfolio, identify QBI opportunities, and develop a customized plan to minimize your tax liability while maximizing your investment returns.