How Trump’s One Big Beautiful Bill Impact Short-Term Rentals

When it comes to travel trends in 2025, the biggest disruption isn’t a new vacation hotspot or booking behavior it’s coming straight from Washington, D.C.

On July 4, 2025, President Trump signed into law the One Big Beautiful Bill, a sweeping piece of tax legislation with major implications for Airbnb hosts, Vrbo owners, and other short-term rental operators across the U.S.

If you own or manage short-term rental properties, this new bill could open the door to larger profits, new deductions, and better long-term investment strategies—but only if you understand how to use it to your advantage.

In this article, we’ll break down the key changes in the bill, what they mean for your business, and how you can prepare to maximize benefits while staying compliant with the new rules.

QBI Deduction for STR Business

Good news for many hosts: the 20% Qualified Business Income (QBI) deduction for pass-through entities (like LLCs, sole proprietorships, or S corporations) remains in place. What this means for you: If your short-term rental activity qualifies as a trade or business under IRS rules, you may continue to deduct up to 20% of your net rental income significantly lowering your taxable income. 

The cap on State and Local Tax (SALT) deductions has been raised to $40,000, a significant increase from the previous $10,000 limit, helping hosts in high-tax states lower their federal tax burden.

What Hosts Need to Know: Bonus Depreciation Revived

• The TCJA introduced 100% bonus depreciation, allowing full write-off of qualified assets in year one.
• It was scheduled to phase down (60% in 2024, 40% in 2025); but OBBBA restores 100% bonus depreciation retroactively from Jan 20, 2025, through 2029.
• This enables Airbnb and STR hosts to fully expense furniture, appliances, improvements, smart-home tech, etc., immediately rather than depreciating over years.

Cash‑Flow Boost

By depreciating qualifying purchases immediately, hosts improve cash flow and enhance ROI, especially important for scaling multiple properties. Lower taxes mean more money to reinvest. Whether you’re acquiring a new property or enhancing an existing one, partnering with experienced professionals can significantly improve your cash flow. At Orlando Short Term, we are dedicated to helping you maximize the return on your investment.

Local Regulation Still Relevant

While recent tax policy changs create a more favorable environment for Short term Rental Investment, it’s important to recognize that many cities continue to enforce zoning restrictions, permitting requirements, and transient occupancy taxes.  These local regulations can significantly im0pact your operations and profitability.  Staying informed and fully compliant with municipal and county level rules is essentials to protect your investment, avoid costly fines, and ensure long term success in the Short Term Market.

Strategic Takeaways for Hosts

• Act Fast: Place assets into service in early‑2025 to fully leverage restored bonus depreciation.
• Consult Your CPA: Coordinate with tax professionals to maximize depreciation, QBI, and SALT benefits.
• Track Costs Carefully: Documentation is key file proof of asset purchase, deployment date, and usage.
• Stay Local‑Savvy: Monitor STR regulations in your area (e.g., caps, hosting licenses).
• Plan Upgrades: Consider larger one‑time renovations or smart‑tech investments to maximize immediate deductions.

Trump’s 2025 tax overhaul is a game-changer for short-term rental investors. With 100% bonus depreciation restored, hosts can write off significant property investment costs immediately potentially reshaping cash flows and making early 2025 the ideal time to expand or outfit new rentals.

However, these opportunities come with responsibilities: rigorous record‑keeping, regulatory compliance, and strategic tax planning are essential. When navigated wisely, this policy can offer both improved profitability and a competitive edge in an increasingly dynamic STR landscape. Is very important to you look for a Vacation Property Management Orlando FL to help you in taking advance of this Beautiful Bill.