Regulatory Updates: OBBBA, IRS Notices, Tax Court

Ten primary-source regulatory updates. OBBBA implementation, IRS Notices issued under OBBBA, Section 168(n) Qualified Production Property, state conformity tracker, and Tax Court precedent shaping current cost segregation practice.

• OBBBA Complete 2025-2026 Update: Every Tax Change for Real Estate

  Public Law 119-21 (OBBBA) was signed July 4, 2025 and effective January 19, 2025 for acquisition cutoffs. Every change relevant to real estate investors: 100% bonus, $2.5M Section 179, Section 168(n) QPP, Opportunity Zones extension.

• IRS Notice 2026-11: Interim Guidance on Amended Section 168(k)

  IRS Notice 2026-11 was issued January 14, 2026 and provides interim guidance on the additional first-year depreciation deduction under Section 168(k) as amended by OBBBA. Binding contract definition and election mechanics.

• Section 168(n) Qualified Production Property Under OBBBA

  OBBBA added Section 168(n) creating a new bonus depreciation pathway for nonresidential real property used in qualified production. Construction begins after January 19, 2025. Placed in service before 2031.

• IRS Notice 2026-16: QPP Implementation Guidance

  IRS Notice 2026-16 provides implementation guidance for Section 168(n) Qualified Production Property. Construction-begin definition, qualified production use, placed-in-service rules.

• Permanent 100% Bonus: Long-Term Real Estate Planning Implications

  OBBBA made 100% bonus depreciation permanent. Long-term real estate planning implications: acquisition timing, hold strategy, recapture exposure, exit planning.

• State Conformity Tracker: OBBBA Bonus Depreciation by State

  Current state-by-state conformity status for OBBBA bonus depreciation. Rolling conformity, static conformity, decoupled-partial, decoupled-full, and states with no income tax.

• IRS Pub 5653 February 2025 Update: What Changed

  The February 2025 edition of the IRS Cost Segregation Audit Techniques Guide incorporates OBBBA changes and explicitly addresses virtual site inspections.

• Permanent Opportunity Zones Under OBBBA

  OBBBA extended Opportunity Zone deferral through 2033 and made the program permanent. Long-term planning implications for cost-segregated QOZB real estate.

• Section 179 Expansion Under OBBBA: New $2.5M Cap

  OBBBA raised the Section 179 dollar limitation to $2.5 million with a $4 million phaseout. Implementation details, eligible property, and interaction with bonus depreciation.

• AmeriSouth v. Commissioner: How the Case Shaped Cost Seg

  AmeriSouth XXXII Ltd v. Commissioner (T.C. Memo 2012-67) sharpened the line between Section 1245 personal property and Section 1250 real property for cost segregation studies.