Let the IRS Pay for Your Next Investment Property

The single biggest bill you pay every year is your taxes. So, if you pay $10’s of thousands to the IRS every year, it's probably time to buy a rental property. And owning investment property, one of the oldest tax savings tricks in the book, has gotten even sweeter recently.

Here’s the recipe: 

The Appetizer ~ Bonus Depreciation

Internal Revenue Code Section 168(k), aka bonus depreciation, has been permanently restored for qualifying business equipment. That means items like appliances, flooring, fencing, and other shorter-lived assets identified through a cost segregation study — can potentially be written off in the year you buy your property instead of over 29.5 years like regular depreciation.

The Meat and Potatoes~Everyday Expenses

Every dime that you spend on mortgage interest, property taxes, insurance, maintenance, and property management fees are deductible against your rental income.

The Bottle of Wine~ Regular Depreciation

Depreciation is definitely something to savor….you write off the value of the building over time, but add that number back in when qualifying for a loan. Setting you up to be able to buy more properties.

Dessert ~ Buy Where You Might Retire

Take a page from Gia’s playbook and buy an investment property somewhere you might want to retire someday. When the time comes you can convert that property from a rental into your primary residence. Note: We place out of area referrals from our vetted network of trusted agents around the country. 

Sugar on Top ~ Investing Close to Home 

Buying a second property in the same town you live in is a great strategy. Closer to home is easier to manage and the home can be purchased with future downsizing in mind, or as a home for an aging parent, children, and grandchildren.