ICSC Priorities Preserved in Tax Mega Bill

On July 3, President Donald Trump’s “One Big Beautiful Bill” cleared its last Congressional hurdle – passing the House 218 to 214. The bill was signed into law at a White House ceremony the following day.

“The legislation maintains a consistent, fair playing field for commercial real estate entities, and even improves upon certain portions of the 2017 tax bill,” ICSC President & CEO Tom McGee said. “Our members will be able to invest more resources into their local communities because of the framework this bill provides.”

ICSC members achieved significant wins in the bill. The association's multi-year advocacy efforts included numerous stakeholder meetings with lawmakers in both chambers and Trump administration officials, both locally and in Washington, DC. ICSC members met with 141 Congressional offices during the Federal Fly-In in March and sent more than 1,500 emails this year to Congress on our tax priorities. The final bill is a testament to these efforts.

Key tax items in the One Big Beautiful Bill include:  

• Sec. 199A Pass-Through Deduction – Made permanent at 20%.  
• Carried Interest – No changes to current law.   
• 1031 Like-Kind Exchanges – No changes to current law.   
• Proposed Sec. 899 (retaliatory tax on foreign investment) – Included in the House text but removed from the final bill in the Senate.  
• Business SALT – Current tax law is maintained. No limitations on the deductibility of property or income taxes were included.  
• Individual SALT – The Senate’s provision limiting income tax deductibility for pass-throughs has been removed. The individual SALT cap is increased to $40,000 but reverts to $10,000 after five years.   
• 100% bonus depreciation and 163(j) EBITDA Business Interest Limitation – Made permanent and reinstated retroactively.  
• TRS Asset Test – Increases from 20 to 25% the amount of a REIT’s assets that can be held in a Taxable REIT Subsidiary.
• Estate and Gift Tax Exemption – Permanently increased to $15 million and indexed for inflation.
• Opportunity Zones – Provides a second round of designations and makes other adjustments to the current program. 

For more information contact Phillips Hinch at phinch@icsc.com.