CREF Policy Update: ICYMI: Final Tax and Reconciliation Package Contains Numerous Pro-Real Estate Tax Provisions

July 15, 2025

ICYMI: Final Tax and Reconciliation Package Contains Numerous Pro-Real Estate Tax Provisions

In what is a significant win for MBA members, the full U.S. House of Representatives last week passed, and the President signed, the Senate’s substitute amendment to H.R. 1, the Republican tax/reconciliation package, by a vote of 218-214.

• The megabill includes numerous MBA-supported tax changes, increases the debt limit by $5 trillion, and contains spending cuts and energy, defense, and border security measures.

What they’re saying: MBA President and CEO Bob Broeksmit, CMB, in a press statement, said, “MBA is pleased that the final tax package preserves or strengthens – and makes permanent – numerous pro-housing and pro-economic growth tax provisions that were identified by our Board-level Tax Task Force, led by 2025 Chair-Elect Christine Chandler and Vice Chair Owen Lee.”

Why it matters: Through direct advocacy efforts with Republican lawmakers and their key staff, MBA secured numerous tax policy changes that preserve, and in several cases enhance, key elements of the 2017 Tax Cuts and Jobs Act, including:

• Makes permanent the 2017 individual rate structure and increased standard deduction;
• Maintains and makes permanent the 20% deduction in current law for Qualified Business Income under Section 199A – and expands the deduction limit’s “phase-in” range;
• Allows 100% bonus depreciation for certain qualifying properties and restores/makes permanent full expensing for new capital investments;
• Temporarily raises the current state and local tax (SALT) deduction cap to $40,000, with a $500,000 income cap that grows annually by 1% until it “snaps back” after five years;
• Makes durable enhancements to the Low-Income Housing Tax Credit (LIHTC) program, e.g., providing a permanent 12% increase in 9% credit authority, while permanently lowering the bond financing test from 50 to 25%;
• Makes a renewing set of rounds of the Opportunity Zones (OZ) program permanent – with needed reporting/programmatic tweaks;
• Permanently reinstates EBITDA for the calculation of business interest deductibility; and,
• Significantly, does NOT alter the deferred tax treatment of MSRs, nor the tax code’s current “gain on sale” provision, Section 1031 Like Kind Exchange rules, carried interest provision, or capital gains rate.

What’s next: MBA is reviewing the legislation in greater detail and will provide a comprehensive summary of the tax provisions pertinent to real estate finance.

For more information, please contact Rachel Kelley at (202) 557-2816, Madisyn Rhone at (202) 557-2741, George Rogers at (202) 557-2797, Ethan Saxon at (202) 557-2913, Fran Mordi at (202) 557-2860, and/or Bill Killmer at (202) 557-2736.

Upcoming MBA CREF Councils and Committee Meetings

MBA’s CREF Councils and Committees are a key way to connect to everything MBA has to offer around policy, advocacy, market intelligence and research, education, and networking. Councils and Committees are built around specific capital sources and serve as an opportunity for you to join other commercial real estate finance professionals to hear from experts, discuss opportunities and challenges, and connect with peers.

What’s next: Upcoming virtual meetings include:

• Life Company Council: July 15
• Servicer Council: July 17
• Structured Finance Council: Aug. 6
• Bank Council: Sept. 24
• Commercial Council: September

For more information, click on the links above and/or contact Kelli Burke at (202) 557- 2742.

Register: MBA’s mPact Summit on Aug. 5

Young professionals, meet us in the nation’s capital for a full day of career development and networking on Tuesday, Aug. 5, 2025. Back by popular demand, this event is built by young professionals in the real estate industry, for young professionals, and focused on helping you get to the next level.

Why it matters: The mPact Summit isn’t just about career tips, it’s about empowerment, connection, and growth! The summit will provide the tools, confidence, and network to thrive and help you become tomorrow’s leaders.

For more information, please contact Jacky Salazar at (202) 557-2746

Upcoming MBA Education Webinars on Critical Industry Issues

MBA Education continues to deliver timely commercial/multifamily and single-family programming that covers the spectrum of challenges, obstacles and solutions pertaining to our industry. Below, please see a list of upcoming and recent webinars – all complimentary to MBA members:

• Essential Overview of Commercial/Multifamily Business Income Insurance – July 15
• Navigating Coverage and Risk for Commercial Catastrophic Insurance – July 21
• Practical Application of Distressed Asset Valuation – Case Examples and Lender Perspectives – Aug. 13
• Using Ordinance and Law Insurance to Protect Your Property and Business Recovery – Aug. 27
• Trends in Commercial Non-Bank Lending: Evolving Strategies & Creating Operational Advantages – Sept. 9

MBA members can register for any of the above events and view recent webinar recordings by clicking here.

For more information, please contact David Upbin at (202) 557-2931.

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