The US Tax Code Favors Real Estate Investors

Share This Post

Yet, most investors don’t know how to take advantage of these tax benefits.

A real estate investor focused, virtual CFO will help investors implement tax savings strategies to successfully to reduce or defer the resulting income tax from the sale of real estate. Real Estate Investors can face unique tax challenges from the sale of real estate.

Whether you regard taxes as a necessary evil, or just plain evil, understanding the types of taxes that may apply to various types of income derived from real estate investment and real estate transactions, and how to manage your tax liabilities, will directly impact the profitability of your real estate investment business.

Rental income, like other forms of income, is subject to taxation. The effective rate of taxation applicable to you will depend on many factors, not least of which is being aware of all the allowable deductions that you can claim to reduce your tax liabilities.

For fix-and-flip investors, an important consideration is taxes that apply to real estate transactions, specifically when selling a property. A capital gain is an increase in the value of a capital asset, and that increase in value is realized when the asset is sold. Short-term capital gains are taxed at higher rates than long-term capital gains – an important consideration for investors who aim to hold a property for the shortest period possible before selling it for a profit.

Two Tax Tips for Real Estate Investors:

Tip #1 – Be organized and keep records. To be able to claim deductions, you need to keep records of your expenses related to the operation of your rental properties. Your tax accountant can give you advice on the types of expenses you need to track.

Tip #2 – Consult a tax accountant! It doesn’t matter if you only own one property or several, a tax accountant can give you valuable information and advice on deductions, local and state-specific tax laws, and how to be tax compliant while keeping your tax liabilities as low as possible.

Contact Irina Troychanskaya for more information and helpful resources for optimizing your investments and investment results, in order to maximize your tax savings.


Subscribe To Our Newsletter

Get updates and learn from the best

More To Explore

multifamily market update February 2024

2024 NMHC San Diego Multifamily Recap Report

This past week, thousands of real estate professionals descended upon San Diego to attend the NMHC Apartment Strategies Conference. There, a distinguished lineup of multifamily experts provided insight.


SBA Update for Business Acquisition Loans

This notice revises several provisions in SOP 50 10 7.1, which governs the SBA’s 7(a) and 504 loan programs. The revised provisions are effective as of the date of the notice.

Looking for more Deal flow?

Connect with one of our Advisors to learn about referral services for Buyers and Sellers.

Skip to content