Surprising to me more YIMBYs are not fans of accelerated depreciation!
With zoning reform happening in more places, but interest rates remaining high - this is a key way to get building to happen
Conversation
While on the whole itโs a dumpster fire, I did catch that the OBBB narrowly expands accelerated depreciation:
Any tangible operating equipment with a <20 yr life used in residential rental properties do qualify for the 100% bonus depreciation under 168(k) as amended by the OBBB.
Yeah and makes cost segregation more important. Just doesnโt apply to structures
What if I told you the way you structure your real estate deal could save you thousands in taxes?
Creative deal structuring isnโt just for the pros.
Understanding how to leverage 1031 exchanges, depreciation, or even seller financing can drastically change your bottom line.
Isn't it missing the tax shelter aspect of it? Accelerated depreciation is useful if you have profits to use it against or if losses can be claimed against tax liability. 1981-86 was the heyday of passive loss use against personal income tax liability of investors
Iโve been talking about it for years. Iโve heard others discuss it too.
I donโt work on federal policy, however.
Canada had an experiment with accelerated depreciation on multi unit residential housing in the late 1970s. Investors could write off the "losses" against other income. There was a huge boom in construction and rents fell.
Accelerated depreciation is consistent with the belief that we should be constantly replacing old, decrepit housing with newer and nicer housing.
There's more than one-way to skin a cat.
If the goal is make housing more attainable for more people, we shouldn't get hyper focused on just one approach such as "ending Euclidian zoning".
Because theyโre dilettantes who donโt know anything about anything
Why pay more than you need to?
A lot of real estate investors forget this one key fact:
When a realtor is involved, sellers often raise their asking price to cover commission fees.
That means youโre the one footing the bill.
By cutting out the middleman, you can save tens of