Arizona Real Estate Wins Big with the One Big Beautiful Bill Act (H.R. 1)

The One Big Beautiful Bill Act signed into law in July 2025 brings sweeping tax reforms that create new opportunities for real estate investors, developers, and property owners across Arizona. Here’s how Arizona real estate stands to benefit:

1. Stronger Interest Deductions for Developers & Investors

• EBITDA-based limits return in 2025—boosting leverage and cash flow.
• Helps development in high-growth corridors like Loop 303, East Valley, and I-10 West.

2. Temporary SALT Cap Boost – $40,000 in 2025

• High-income earners and dual-state filers gain short-term tax relief.
• Encourages investment in vacation homes and second properties in Arizona.

3. Energy-Efficient Building Deduction (179D)

• Federal deduction up to $5.00/sq. ft. for energy-efficient builds or upgrades.
• Projects must start before June 30, 2026.
• Applies to office, medical, industrial, multifamily, and government-leased properties.

4. Permanent 100% Bonus Depreciation

• Applies to business-use and logistics real estate through 2030.
• Ideal for industrial development in Arizona’s growing corridors.

5. Qualified Business Income (QBI) Deduction

• Extended 20% deduction for pass-through income (LLCs, S-corps, syndications).
• Boosts returns on income-producing property holdings.

6. Estate Tax Exemption Raised

• New $30M per couple exemption encourages long-term real estate legacy planning.
• Benefits family-owned portfolios and generational transfers.

7. New Tools for Rural Arizona

• Tax-exempt rural/agricultural financing benefits Gila, Pinal, Navajo, and Yavapai counties.
• Expanded Opportunity Zone and LIHTC access drive investment to underserved areas.

Arizona Real Estate Sector Benefits