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

July 18, 2025

One of the biggest shakeups in U.S. 2025 travel trends is coming from Washington, D.C., not just from new destinations or guest behavior.

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President Trump’s newly passed One Big Beautiful Bill (July 4, 2025) delivers sweeping tax changes that could transform how Airbnb hosts and Vrbo owners operate, invest, and grow their businesses.

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If you’re running short-term rentals in today’s competitive market, this legislation could significantly increase your profits. Let’s break down what’s changing and how to make the most of it.

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Before we get started, please note that all tax information and tips shared in this article shouldn’t be taken as professional advice. To get tax advice tailored to your unique needs, make sure to call in a professional!

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1. 100% Bonus Depreciation Is Back

The bill reinstates full bonus depreciation through 2029, allowing STR owners to immediately expense qualifying assets like appliances, renovations, and furnishings. This is a huge win for Airbnb hosts and Vrbo operators looking to reduce their tax bills and reinvest in upgrades.

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For even greater impact, consider using a cost segregation strategy to identify short-life assets that qualify for accelerated depreciation.

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2. Permanent QBI Deduction for STR Businesses

If your rental business is structured as an LLC or S-Corp, you can deduct up to 20% of your qualified rental income. The bill makes this deduction permanent, which increases long-term profitability and enhances the financial appeal of operating as a formal business.

This is especially valuable for professional Airbnb hosts and multi-property operators.

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3. Better Cash Flow = Faster Growth

Lower taxes mean more money to reinvest. Whether you're upgrading your Airbnb listing, hiring cleaning teams, or expanding into a new market, the cash flow bump from these tax breaks helps fuel growth. Timing is key—any renovations or new furniture purchases should happen before the 2029 cutoff to capture full depreciation value.

4. Don’t Ignore Local Regulations

While the federal government is handing out tax breaks, local governments are cracking down. Cities like Beverly Hills have banned short-term rentals altogether, and others are capping licenses or enforcing stricter zoning.

If you’re a Vrbo or Airbnb host, it’s essential to stay updated on your local laws. Read more about tips for handling highly regulated markets here.

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Bonus Tip: Know Your Numbers with a Free ROI Calculator

Before making any major decisions, use a free Airbnb profit calculator to forecast potential returns. Whether you're considering a new property or upgrading an existing one, this tool helps you estimate expenses, occupancy, and revenue—giving you confidence in your STR investment decisions.

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Final Thoughts

Trump’s One Big Beautiful Bill may have a large impact for short-term rental owners in the years to come. With accelerated depreciation, permanent income deductions, and more available capital, Airbnb hosts and Vrbo operators have the opportunity to grow faster and smarter. Just make sure to act before the 2029 deadlines and keep an eye on your local regulatory landscape.

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While we have you, have you checked out dynamic pricing tool for Airbnb hosts, Vrbo hosts, etc.? Our vacation rental pricing tool takes the guesswork out of pricing your vacation rental and is proven to earn you more revenue! Try it out today!

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