Will you have rental income/expense again in 2024? 🏡

Hi!

I saw that you have rental income/expenses on the last return that you completed with us. Other than preparing your tax, my goal is to proactively save your tax. 

There are several tax strategies that we can implement that can produce short-term and long-term tax breaks. Have you considered the following? 

Cost segregation

Cost segregation is a strategy that allows us to depreciate your rental property in components. This means that instead of the normal depreciation deduction, we can take depreciation much faster by allocating the correct useful life for each component. For instance, if a component has a 5-year useful life, we can take 5x more depreciation than the standard 27-year depreciation. This can lead to material tax savings in the short term – we have seen clients taking 5-figure deductions on a routine basis using this.

LLC or entity creation

Having a legally separate entity can help with tax savings or liability protection. If you do not have an LLC or entity set up, this is the time to set this up while we still have time to implement. The opportunities here are far more than we can fit in an email, so ask more if interested. 

Real estate professional status 

If you or a spouse are spending the majority of your work time in real estate & use real estate as a primary source of income, we can qualify for this & take even larger deductions. This includes taking deductions even against wage income. 

1031 exchanges 

These can be used to completely eliminate capital gains tax – we are available to administer the entire transaction for you if you need a qualified intermediary 

Conclusion 

If you need help with setting up any of the above, we can assist from A-Z – just contact us below. If you have questions about any of the above, let me know – happy to provide guidance!

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George Dimov CPA

www.dimovtax.com

(833) 829-1120 toll free