Only a Few Months Left to Grab Six-Figure Write-Offs by Buying an STR in Nashville

Oct 9

If you’ve ever thought, “Maybe I’ll hop in the short-term rental game someday,” the time is now — and I mean right now.

With the return of 100% bonus depreciation for 2025 (via the One Big Beautiful Bill), investors can now deduct huge chunks of cost in year one. And for those who act before year-end, the potential tax savings can run well into six figures.

You don’t need to do massive renovations. You just need to buy an STR, make it rent-ready, and have it placed in service by December 31. That’s the “loophole” many are calling their edge.

Here’s exactly how this works in Nashville — and why the next few months may be your last chance with conditions this favorable.

🧩 What’s the STR “Loophole” (and Why It’s More Than a Loophole)

When I say “loophole,” I don’t mean something shady — I mean a legal, IRS-recognized strategy that many miss. It works like this:

Cost Segregation + Bonus Depreciation Synergy
By running a proper cost segregation study, you break down your property into components (personal property, fixtures, equipment, interior improvements) that can be reclassified into shorter depreciation lives (5, 7, 15 years) instead of being lumped into the standard 27.5- or 39-year life of the building.
Many of those shorter-lived components can then qualify for 100% bonus depreciation in the year they’re placed in service — even in a new STR acquisition.
In effect, you “pull out” large portions of your purchase into assets that you can immediately expense, rather than waiting decades for depreciation.
Placed-in-Service Timing
The key is “placed in service.” That’s the IRS term meaning the property or its qualifying components are ready and available for rental use.
If you close the property and have it rent-ready before December 31, 2025, those assets (furniture, appliances, interior finish, systems) become eligible for the full bonus write-off. You don’t have to gut the roof or do massive structural flips to get the benefit — a lot comes from the “inside stuff,” assuming your cost seg is done well.
Exclusion of Some Structural Elements
Not everything can be bonus depreciated — the roof, structural load walls, foundation, etc., generally remain on the long-life depreciation schedule. But if your cost seg peels off enough of the “stuff inside,” you can still get massive deductions. The “loophole” is really “knowing how to legally carve things the right way.”

In short: buy an STR, run cost segregation, place in service before year-end, and you capture the deduction.

📍 Why Nashville Is Especially Powering This Strategy

Nashville isn’t just any STR market. The timing, development, and catalysts here make it one of the most promising places in the U.S. to apply this strategy now.

Big redevelopment on the horizon
The East Bank of the Cumberland River is undergoing major transformation, anchored by the planned Oracle campus, mixed-use developments, and proximity to a brand new stadium site. Nashville.gov+2Tennessean+2
This means new jobs, more traffic, more demand for short-term stays, and rising property values in neighborhoods adjacent to downtown.
The city is reimagining the East Bank, connecting neighborhoods, improving infrastructure, and opening up zones for residential + commercial. Nashville.gov
A new Nobu Hotel & Restaurant is also confirmed for Nashville’s East Bank as part of the Oracle development. LATTE Luxury News+1
New stadium + long-term gains
The existing Nissan Stadium is slated to be replaced, and in collaboration with the East Bank plans, the surrounding zone is primed for mixed-use, entertainment, residential, and tourism growth. Tennessee Lookout+4Wikipedia+4Nashville.gov+4
Investors that enter now in neighborhoods around these zones stand to benefit not just from rental income + tax deductions, but from capital appreciation as the city evolves.
STR market fundamentals are solid
Even though supply growth is slowing, Nashville’s STRs continue to perform well. revedy.com+2nashvillecityliving.com+2
Bookings have been up, and demand remains high, especially in downtown, East Nashville, 12 South, The Gulch and neighborhoods within easy access to music venues, events, and restaurants. nashvillecityliving.com
Additionally, Nashville is projected to open among the most new hotel rooms in 2025—yet demand from tourists, events, and travelers is expected to remain strong. STR

In essence: you get the tax benefit now, plus the upside of capital gains and rental demand as Nashville’s skyline and neighborhoods evolve around you.

⏳ Why It’s a Race — Only Months Remain

Placed-in-service deadline: To capture 100% bonus depreciation in your 2025 return, the property (with its qualified components) must be placed in service by December 31, 2025. Delay into 2026, and you lose that deduction this year.
Permits, planning, furnishing, inspections take real time. Delays happen.
Contract timing risk: If you locked into improvement contracts or binding agreements before the cut-off (depending on IRS transitional rules), some assets might be subject to older, phased-down rules rather than full bonus.
Tax planning & cost seg lead time: Your CPA and cost seg provider need time to run the analyses, do allocations, and integrate everything into your return.
Competitive investor activity: Others are already moving. Deals will get harder to find, prices may increase, and your best zones around redevelopment areas will fill up.

Once January hits, this window will close for 2025. The difference may be tens or hundreds of thousands of dollars in lost deductions.

🏃‍♂️ What You Should Do Right Now (Your To-Do List)

Zero in on STR-qualified neighborhoods near the East Bank, South/West downtown, The Gulch, 12 South, East Nashville — places investors want to be as growth spreads.
Run the numbers on potential deals, including projected cost segregation carve-outs, rental income, expenses, financing, etc.
Line up your team: cost segregation engineer, STR-savvy CPA, property manager, contractor (for quick fixes or furnishing).
Make early moves – lock a property, structure your cost seg, start placing furniture, list the property or get it ready for guests.
Document everything: purchase docs, invoices, installation dates, proof of being “rent-ready” and listed.
Stay nimble: If delays occur, prioritize finishing the interior “bonus-able” parts first so you can claim as much as possible.

🔚 Bottom Line & Call to Action

There’s no guarantee the stars will align like this again soon:

A full 100% bonus depreciation is officially back for 2025
Nashville’s East Bank / Oracle / stadium redevelopment is creating outsized growth potential
The STR market remains strong, and more supply is coming — enter early to capture upside
But this is a now-or-never window — once 2026 hits, the opportunity for that full write-off in year one largely vanishes

If you’re considering buying an STR in Nashville, this could be your shot to lock in large tax savings and ride the wave of growth. Let’s run the numbers together on properties that qualify and build a timeline to make sure you hit the year-end window.