Maximizing Tax Benefits From The Big Beautiful Bill

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Jul 10, 2025

In this discussion, tax guru Ryan Bakke, owner of Tax Strategy 365 CPA, shares his expertise in helping short-term rental investors navigate recent tax law changes. He delves into the implications of the Big Beautiful Bill, particularly focusing on bonus depreciation and its potential tax savings. Ryan explains how different depreciation schedules can supercharge investment returns and highlights the Qualified Business Income deduction's relevance for rental properties. Tune in for insights on smart financial strategies and innovative children's savings accounts!

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ANECDOTE

Ryan's Journey to Short-Term Rentals

Ryan Bakke began helping everyday people, especially real estate investors, instead of only wealthy clients in large firms.
He discovered short-term rentals massively increased rental income compared to traditional long-term leases.

ADVICE

Do Not Buy For Tax Benefits Alone

Never buy real estate solely for tax benefits; cash flow must come first.
Tax savings only help if the property isn't financially losing money monthly.

INSIGHT

Tax Law Spurs More Market Activity

New tax law changes will increase short-term rental market activity but won't drastically change home prices or interest rates.
Many investors have been waiting on the sidelines and will enter the market due to improved tax incentives.

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In this episode of the STR Data Lab, Jamie Lane hosts a discussion with Ryan Bakke about recent changes in tax law from the Big Beautiful Bill and their implications for short-term rental investors. Ryan, who has extensive experience helping investors save on taxes, explains his journey into the short-term rental and real estate tax niche.

The conversation highlights recent tax law changes and their potential impact on investment strategies. Key changes discussed include bonus depreciation, its implementation, and how it can impact short-term rental investors. Ryan explains the concept of bonus depreciation, providing examples of potential tax savings and how these can be reinvested to grow initial investments. He also talks about the significance of qualifying for different depreciation schedules and cost segregation for leveraging tax benefits. Another major topic is the Qualified Business Income (QBI) deduction, its permanency, and who qualifies for it, especially in the context of short-term rental investments vs. long-term rentals. Ryan elaborates on the qualifying rules for offsetting W-2 income with short-term rental investments, including the 7-day use test and additional hour requirements.

He also discusses potential economic benefits, such as saving on personal car interest and employer-paid student loans. The introduction of new financial accounts for children's savings and the broader economic effects of these tax changes are touched upon. Throughout, Ryan shares practical advice for investors on how to navigate these changes and maximize their tax savings. The session concludes with Ryan's recommendations for additional resources and ways to stay informed about tax strategies for real estate.

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Episode 142