In the Texas real estate and construction sectors, 2026 is being hailed as the “Year of the Tax Pivot.” With the permanent restoration of 100% Bonus Depreciation and a massive increase in the Business Personal Property (BPP) exemption, the financial landscape for developers and contractors has shifted beneath their feet.
At FAS Accounting Services, we specialize in turning these regulatory changes into competitive advantages. Whether you are navigating a 1031 exchange in Austin or implementing high-precision job costing for contractors in Frisco, our mission is to ensure you keep more of your hard-earned capital.
For years, the phase-down of bonus depreciation was a looming threat to real estate ROI. However, under the latest federal guidelines (OBBBA), 100% Bonus Depreciation is back and permanent for qualifying assets.
Typically, commercial buildings are depreciated over 39 years. Through a cost segregation study, a professional real estate investment CPA can reclassify 20% to 35% of those assets—such as specialized lighting, landscaping, and flooring—into 5, 7, or 15-year recovery periods. In 2026, you can deduct 100% of those costs in Year One.
In a landmark move for 2026, the Texas Comptroller has aligned state depreciation rules with federal OBBBA provisions. This means your “Cost of Goods Sold” (COGS) deduction on your Texas Franchise Tax report can now include the full expensing of qualifying fixed assets acquired after January 19, 2025.
Perhaps the biggest win for Texas construction and real estate firms in 2026 is the expansion of the Business Personal Property (BPP) exemption.
Pro-Tip: As Texas property tax consultants, we recommend reviewing your 2026 renditions carefully. You are only required to render property if the aggregate market value exceeds the $125,000 threshold, but certifying your exemption is still a critical compliance step.
In an era of fluctuating material costs, “ballpark” estimates are a recipe for bankruptcy. 2026 construction bookkeeping services must revolve around real-time job costing.
To maintain a #1 position in the Texas market, your job costing must track:
The OBBBA has expanded the definition of “Residential Construction Contracts.” Now, many large-scale multifamily and mixed-use projects qualify for the Completed Contract Method (CCM) or the cash method. This allows you to defer income recognition until the project is finished, dramatically improving your working capital during the build cycle.
The 1031 Exchange remains the most powerful wealth-building tool in real estate, but the IRS has increased its scrutiny of “Same Taxpayer” compliance in 2026.
For the latest federal forms and instructions, consult the official IRS Like-Kind Exchange Portal.
If you are looking for long-term gains, the Qualified Opportunity Zone (QOZ) program has been refreshed for 2026.
For the 2026 report year, the threshold is $2.65 million. If your annualized total revenue is below this amount, you are generally not required to file a No Tax Due report, though you must still file a Public Information Report (PIR).
General accounting tracks the health of your company. Job costing tracks the health of individual projects. Without it, one “bad” project can silently eat the profits of three “good” ones.
Yes, but only for the components that are not part of the building’s structural shell. Items like appliances, carpeting, and specific “land improvements” qualify for 100% expensing in 2026 through a cost segregation study.
This is a newer state-level credit available for franchise or insurance tax liabilities. It applies to developers awarded a state housing credit for qualified low-income or “at-risk” developments placed in service on or after Jan 1, 2026.
Learn more at the Texas Department of Housing and Community Affairs (TDHCA).
Texas is the land of opportunity for real estate and construction, but only for those who master the “Tax Game.” From construction payroll management to high-level developer financial planning, the team at FAS Accounting Services is here to be your strategic partner.
Don’t let 2026’s tax changes be a hurdle. Make them your springboard.
