Tax strategy can make or break a real estate investment — and mobile home park investing is no exception. Thanks to the One Big Beautiful Bill Act signed into law on July 4, 2025, 100% bonus depreciation is back. This time, it may be here to stay. For mobile home park investors, this could represent one of the most powerful tax planning opportunities in years. This article breaks down what changed, and how it may apply to mobile home parks.

What Changed: The One Big Beautiful Bill Act

For a few years, bonus depreciation had been on a steady decline. Under the Tax Cuts and Jobs Act of 2017, the 100% deduction began phasing down after 2022. Investors watched that rate shrink year after year.

The Old Phase-Down Schedule

• 2022: 100%
• 2023: 80%
• 2024: 60%
• 2025 (pre-bill): 40%
• 2026 (pre-bill): 20%
• 2027 and beyond: 0%

That phase-down is now gone. The One Big Beautiful Bill Act permanently restores 100% bonus depreciation for qualified property placed in service after January 19, 2025. This effectively removes the phase-down that was previously scheduled under the TCJA. Equally important, this isn’t a temporary extension or a phase-out — it’s likely permanent.

That distinction matters enormously for long-term investment planning in mobile home parks.

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What Is Bonus Depreciation?

Bonus depreciation allows investors to deduct a large portion of eligible asset costs in the year those assets are placed in service, rather than spreading the deduction over many years. Before the One Big Beautiful Bill Act, investors had to work around a shrinking deduction each year. Now, qualifying assets placed in service after January 19, 2025 may potentially be fully expensed in year one.

As always, the deduction applies to personal property and certain land improvements. It doesn’t apply to the land itself or standard building structures. A qualified tax professional should always help determine which assets in your mobile home park may qualify.

Why Mobile Home Parks May Be Especially Well-Positioned

Mobile home parks tend to have a higher proportion of personal property and land improvements relative to total asset value compared to traditional multifamily or commercial real estate. That structural difference may make mobile home parks particularly well-suited to benefit from bonus depreciation.

Assets in a typical mobile home park that may qualify for accelerated depreciation could include utility infrastructure, roads and paving, fencing, signage, landscaping improvements, and certain equipment. However, every mobile home park is different, and proper asset classification should always be determined by a qualified cost segregation engineer and tax professional.

The Power of Pairing Cost Segregation with Bonus Depreciation

A cost segregation study is an engineering-based tax analysis that reclassifies components of a property into shorter depreciable lives — typically 5, 7, or 15 years instead of 27.5 or 39. When you pair that with permanent 100% bonus depreciation, the potential upfront tax benefit may be substantial.

With permanent 100% bonus depreciation, every dollar reclassified into short-life MACRS property through a cost segregation study can potentially be fully deducted in the first year. For example, a mobile home park purchased for $3 million that has 25–35% of its value reclassified as short-life property through a cost segregation study could generate a significant year-one deduction. Though, outcomes will always vary based on the specific property and your individual tax situation.

The Affordable Housing Opportunity

Beyond the tax advantages, mobile home parks represent one of the few remaining asset classes providing naturally occurring affordable housing at scale. According to the Manufactured Housing Institute, approximately 22 million Americans currently live in manufactured housing. This makes it one of the largest sources of unsubsidized affordable housing in the country.

Additionally, supply remains highly constrained. Zoning restrictions have made it increasingly difficult to develop new communities, which means existing mobile home parks may hold strong long-term value. This supply-demand dynamic, combined with potentially powerful tax advantages, continues to attract growing attention to the asset class.

Institutional Investors Are Paying Attention

Major real estate investment trusts such as Sun Communities and Equity LifeStyle Properties have significantly grown their manufactured housing portfolios in recent years. According to Green Street Advisors, manufactured housing REITs have historically delivered some of the strongest total returns across all REIT sectors. While past performance is never a guarantee of future results, this trend reflects growing confidence in mobile home parks at the institutional level.

What Mobile Home Park Investors Should Consider in 2026

Retroactive Benefits May Apply

Mobile home park bonus depreciation restoration applies to assets placed in service after January 19, 2025. This means investors who made acquisitions or capital improvements earlier in 2025 may potentially benefit retroactively. Consulting with a CPA to review any qualifying activity from that period could be worthwhile.

Cost Segregation Studies Are More Valuable Than Ever

Investors may want to schedule a cost segregation study to reclassify eligible assets into 5-, 7-, or 15-year property, making them eligible for full expensing. With the rate now at 100%, the return on investment for these studies may be significantly stronger than during the phase-down years.

Passive Loss Rules Still Apply

Large mobile home park depreciation deductions may create paper losses, but passive loss rules can still limit how and when you are able to use them. Investors who qualify as real estate professionals under IRS guidelines may be able to apply those losses against ordinary income. Others may carry them forward to offset future passive income. Understanding your classification remains an important part of the planning process.

The QBI Deduction Is Now Permanent Too

The One Big Beautiful Bill Act also makes permanent the 20% Section 199A qualified business income deduction, which would have expired at the end of 2025 without action. For mobile home park owners structured as pass-through entities, this may stack meaningfully on top of the bonus depreciation benefit.

The Bottom Line

The permanent restoration of 100% mobile home park bonus depreciation removes years of uncertainty that had complicated long-term tax planning for real estate investors. For mobile home park investors specifically, the combination of favorable asset composition, constrained supply, strong affordable housing demand, and now a permanent and powerful depreciation tool creates a compelling case to take a closer look at this asset class.

As with any tax strategy, the specifics depend heavily on your individual situation. Working with a qualified CPA, tax attorney, and cost segregation specialist is essential to making the most of what the current law may offer.

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Disclaimer:

The information provided is for informational purposes only and is not investment advice or a guarantee of any kind. We do not guarantee profitability. Make investment decisions based on your research and consult registered financial and legal professionals. We are not registered financial or legal professionals and do not provide personalized investment recommendations.