2025-2028: The Temporary Tax Window Strategies Most Owners, Investors, and Professionals Are Ignoring (and Losing Five Figures)

Picture this: Congress quietly lets one of the largest sets of tax breaks in a generation sunset at midnight, and the next morning you wake up with less cash flow, fewer write-offs, and—if you’re in California—even higher taxes. This is not hypothetical. Between 2025 and 2028, more than 22 major tax provisions are set to phase out, shrink, or change. The clock is ticking, but most high earners, business owners, and investors are doing nothing—and that inertia is costing them $15,700 or more every year.

This isn’t about hoping Congress changes the rules back. It’s about 2025-2028 temporary tax window strategies that capture now-or-never savings, and how to execute before the door slams shut.

Quick Answer: The 2025-2028 window delivers unique, time-limited opportunities: expanded 100% bonus depreciation, higher QBI (qualified business income) deductions, increased gift/estate exemptions, and flexible entity structuring. Most of these breakpoints revert on January 1, 2026, slashing savings or closing loopholes entirely. Act now, or leave serious money on the table.

The smartest operators are already modeling 2025-2028 temporary tax window strategies using IRS scenario planning tools—because each move has a short shelf life. The difference between taking 100% bonus depreciation in December 2025 versus January 2026 can exceed $25,000 per $100K of qualifying assets. Similarly, locking in the current $13.61M lifetime gift exemption now shields twice as much wealth from estate tax than waiting until 2026, when the exemption likely drops near $7M.

Why Timing Is Everything: The Tax Window Myth Most People Believe (and Pay For)

It’s a popular belief that tax law changes are gradual and that Congress will extend tax breaks before they expire. The reality is that many tax provisions sunset suddenly—and in 99% of cases, retroactive extensions are rare. If you wait until your 2026 tax prep session to take action, you have missed the window. For example, the 100% bonus depreciation on business equipment drops to just 60% in 2026. That alone can mean paying $27,000 more in taxes for someone acquiring $100,000 in assets.

• Business owners face the return of tighter meal deductions and lower Section 179 expensing.
• Real estate investors lose enhanced depreciation and 1031 exchange flexibility.
• W-2 professionals and HNW earners face a slashed estate/gift exemption, costing heirs millions.

In short: Relying on wishful thinking will cost you. Being proactive—by targeting the next 18 months—creates lasting advantage.

Effective 2025-2028 temporary tax window strategies don’t just save tax—they shift wealth timing. For example, executing accelerated income recognition in 2025 or 2026 (when brackets remain lower under TCJA rules) can front-load income into years with better marginal rates, while deferring certain deductions into the higher-rate post-2026 environment multiplies future offsets. This sequencing is IRS-compliant under Sections 451 and 461 but requires precise cash-flow mapping across multiple years.

KDA Case Study: LLC Owner and Real Estate Investor Capture $53,000 Before the Clock Runs Out

Consider “Allison,” a California-based LLC owner running a consulting agency while building a rental property portfolio. In 2023, Allison earned $325,000 from her business and $92,000 in net rental income. Before engaging KDA, Allison assumed her CPA would handle “year-end tax planning.” Instead, nothing happened—until she realized bonus depreciation and the high estate tax exemption would soon end.

KDA’s team ran a 2025-2028 tax window audit, uncovering these moves:

• Front-loading her 2025 real estate purchases with cost segregation studies, capturing a one-time $88,000 write-off (saving $34,320 at her effective rate)
• Maximizing QBI deduction with an S Corp restructure, reducing self-employment tax ($11,000+)
• Initiating a partial asset sale before the capital gains rate reset, locking in lower tax rates ($7,600 saved)

For $7,200 in KDA advisory fees, Allison’s first-year tax savings hit $53,000—an ROI of over 7x.

Ready to see how we can help you? Explore more success stories on our case studies page to discover proven strategies that have saved our clients thousands in taxes.

Strategy 1: Capture 100% Bonus Depreciation Before It Disappears

For both active business owners and real estate investors, the biggest current-edge is full expensing of qualifying property placed in service before 2026. For the 2025 tax year, the IRS allows 100% bonus depreciation on most machinery, equipment, and certain real property improvements (see IRS Publication 946).

• Example: A construction business buys $120,000 of equipment in December 2025. They deduct the full amount, saving up to $45,600 at a 38% marginal rate. Come 2026, only $72,000 will be immediately deductible; the rest is stretched painstakingly over years.

This is an all-or-nothing play: delay the acquisition until January 1, 2026, and you lose $17,000+ in write-offs.

What Qualifies for Bonus Depreciation?

• Used and new equipment, vehicles (meeting certain thresholds), computers, office furniture
• Leasehold improvements, roofs, and HVAC (with specifics—check IRS source above)

Strategy 2: The QBI Deduction Squeeze—Why Schedule C Owners and S Corps Can Save $25,000+

The qualified business income (QBI) deduction currently lets many business owners write off 20% of pass-through net income. With sunset provisions, eligibility dramatically narrows and phasedowns bite at much lower income levels after 2026. For a California LLC or S Corp with $300,000 in net income, this deduction alone is often worth $20,000-$62,000 annually. If you make $50,000-$400,000 on the side from freelance or consulting, the QBI window matters just as much.

• LLCs taxed as S Corps can also stack QBI with strategic payroll structuring for further savings.
• Solo 1099s or side-giggers: the window is closing on the most flexible deduction phase in recent history.

Pro tip: Don’t wait until your 2026 tax return to chase this deduction; get structured by early 2025 and maximize high-income years before limits hit. Review IRS Form 8995 guidance for details.

Will the QBI Deduction Be Extended?

No one can guarantee it. Congress has not signaled strong appetite for blanket extensions. Smart taxpayers act now.

Strategy 3: Gift and Estate Tax Moves—The $18M Mistake Most HNW Families Make

For high-net-worth (HNW) individuals, the headline risk is clear: the federal estate/gift tax exemption will collapse from nearly $26 million per couple in 2025 to around $13.6 million in 2026. If your estate (including business equity, real estate, investment accounts, and life insurance) is near or above $10 million, failing to act may double your family’s future tax bill.

• Strategic gifting and entity structuring—such as spousal lifetime access trusts (SLATs)—should be executed before December 2025.
• Consider charitable trusts or advanced GRATs for legacy goals.
• California residents note: even though CA lacks a state estate tax, heirs will not escape federal law after the reset.

IRS coverage of the sunsetting unified credit is available in Estate and Gift Tax FAQs.

Strategy 4: Lock in 1031 Exchange & Real Estate Loopholes Before Tightening

1031 exchanges—deferring capital gains tax by swapping income property—are on the chopping block for high-value deals post-2025. While full elimination is unlikely, tightening rules can slam real estate investors with five or six-figure tax bills on formerly exempt swaps.

• Consider closing 1031 exchanges before December 2025 to guarantee full current-law benefits.
• Stack bonus depreciation with cost segregation on new properties—deduct more, sooner.

Refer to IRS guide on 1031 exchanges for compliance detail.

Common Mistake: Waiting for Congress to “Fix” the Expirations

The most expensive trap is complacency. Many owners assume “someone will extend the rules,” or that their old planning still applies. That hope leads to frantic January calls, missed windows, or relying on outdated CPA advice. By 2026, your options have vanished—locking you into higher lifetime tax and less flexible exits.

Red Flag Alert: If your advisor hasn’t flagged these deadlines or offered a window-specific plan, they are costing you money and opportunity.

Is It Worth Paying for a Tax Window Assessment?

Yes. The best returns for business owners, real estate professionals, and legacy-minded HNW earners now come from multi-year proactive planning. This period only comes once a generation.

Track and Stack: How to Implement Your 2025-2028 Tax Window Play

Successful execution pivots on documentation, coordination, and execution BEFORE the window closes:

• Audit your potential bonus depreciation and Section 179 deductions for 2025 purchases now.
• Catalog all QBI-eligible activities, and re-evaluate your entity structure (LLC, S Corp, partnership) for max pass-through benefit.
• For estates over $6.8M single/$13.6M couple, get with an advanced planner to execute high-impact gifting before 2025 ends.
• Create a 1031 exchange checklist for real estate you intend to roll over by early 2026—delays lead to tax spikes.
• Ask your advisor which of your “permanent” deductions are about to disappear—and what to do about it this year.

Pro Tip:

Use the upcoming tax software upgrades for 2025 (including key CA and IRS forms) to scenario-test deductions and phaseouts month-by-month. This is the single best way to see a six-figure difference in net worth for pro-active planners.

FAQ: Your 2025-2028 Tax Window Questions Answered

What If I Don’t Have Major New Purchases in 2025?

Stack up all other expiring deductions. Consider joint ventures or investments that qualify for bonus treatment, even if you don’t buy assets directly.

How Do I Know If My QBI Deduction or Estate Plan Is Impacted?

If your business nets over $50,000 or your estate value exceeds $6.8M, you WILL be directly impacted. The higher your income/net worth, the more urgent it is to act.

Will California Adopt Any of These Changes?

California often follows federal law in structure but is slower to conform. Assume the tightest rule—with rare exception, state relief is not more generous than the feds.

What the IRS Won’t Tell You: Documentation and Timing Are Everything

The IRS only notifies you when rules have changed—but not when your best window to act expires. Capture and save substantiation for 2025 and 2026 moves: purchase records, payroll runs, QBI calculations, and estate gift tracking.

Summary: Don’t Lose the Edge—How to Stay Ahead, Not Behind

This is not just a headline-grabbing tax “deadline.” Between 2025 and 2028, the most significant set of opportunities for business owners, real estate investors, 1099 professionals, and HNW families in decades will close. Get documentation, take decisive action, and fight inertia with a tax window plan tailored to your scenario. Waiting until tax season is zero defense—and a five- or six-figure penalty you never needed to pay.

This information is current as of 11/12/2025. Tax laws change frequently. Verify updates with the IRS or FTB if reading this later.

Book Your Multi-Year Tax Window Strategy Call

The best tax savings in the next decade come from smart planning now—not last-minute scrambling later. Book a personalized multi-year tax strategy session with KDA’s experts to capture every expiring deduction, credit, and loophole before it’s gone. Click here to book your custom consultation now.