By Dave Horwedel, CEO of Torchlight Tax.
Most likely — yes. But it’s not guaranteed just yet.
Let’s break down what’s happening with bonus depreciation and why it matters for your business or real estate investments.
What’s Going On in Congress?
Bonus depreciation is part of a major tax package currently being negotiated in Congress, often referred to as the “One Big Beautiful Bill (BBB).”
Bonus Depreciation has strong bipartisan support and is widely viewed as a way to spur business investment.
If the bill passes, 100% bonus depreciation would return — a major win for business owners and investors.
A Quick Refresher: What Is Bonus Depreciation?
Bonus depreciation allows businesses to immediately write off the full cost of qualifying property, instead of spreading those deductions out over several years.
Under current law, bonus depreciation is phasing out:
- 100% from 2017 through 2022
- 80% in 2023
- 60% in 2024
- 40% in 2025
- 20% in 2026
- 0% in 2027
The House version of the bill would restore 100% bonus depreciation from January 1, 2025 through December 31, 2029, with special extensions for aircraft and long-production property.
Meanwhile, the Senate Finance Committee released its version on June 16, 2025, with a goal of passing it before July 4. Their proposal would make bonus depreciation permanent.
Both chambers are now working to reconcile their versions before sending the final bill to the President.
What About Real Estate?
Here’s where it gets really powerful — especially for real estate investors.
Using cost segregation, investors can identify short-life components in a property (like flooring, appliances, and land improvements). These components are eligible for bonus depreciation.
When 100% bonus depreciation is available, these components can be fully written off in year one, resulting in massive tax savings.
Want to learn more? Watch our video Introduction to Cost Segregation on the Torchlight Tax YouTube channel.
What Should You Do?
If you’re planning to purchase equipment or real estate, don’t wait.
Contact Torchlight Tax for a free consultation at 877-758-7797 or email info@torchlighttax.com.
This could mean tens, hundreds, or even millions of dollars in accelerated deductions.
Example: Real Estate Strategy
Let’s say you earn $5 million in active W-2 income.
Your spouse works 15 hours a week (perhaps managing your real estate properties), has no other job, and qualifies thereby as a real estate professional.
You acquire a $20 million rental property (via down payment and financing) and work with Torchlight Tax for a cost segregation study. The study finds you are eligible for $5 million in BONUS aka accelerated depreciation and the BBB has passed for 100% bonus depreciation. Your 2025 taxable income goes to ZERO!
You are in the 37% tax bracket and save approximately 37% of 5,000,000 = $1,850,000 in taxes in tax year 2025!
I understand this. Interesting isn’t it.
Bottom Line
The clock is ticking — and the opportunity is significant. If Congress passes the BBB, 100% bonus depreciation could once again become one of the most powerful tools for those who act strategically.
Call Torchlight Tax at 877-758-7797 or email info@torchlighttax.com to schedule your free consultation.
For more insights on tax-saving strategies and asset protection, visit www.torchlighttax.com or explore our YouTube channel, where we share hundreds of practical tips to help you keep more of what you earn.
Disclaimer: This content is intended solely for general informational purposes and does not constitute professional advice in areas such as accounting, tax, finance, investment, or law. Neither the author nor the distributor accepts any responsibility for actions taken based on this information. The content does not provide a comprehensive overview of any subject. Always consult a qualified professional before making decisions related to your business, finances, or legal matters.
