Residential rental property is depreciated over 27.5 years, and non-residential real property over 39 years, providing a relatively small deduction each year. But property owners can use cost segregation to speed up the deductions by separately identifying, valuing, and depreciating the personal property and land improvements contained in their property. This can provide a substantial deduction in the first year, especially if bonus depreciation and/or Section 179 is used to deduct the full cost of these assets in one year.

If you want to convert your home to a rental property, don’t. Instead, sell your home to your S corporation and then have the S corporation make the property a rental property. We have written about this previously, and we received some questions that we address in this article.

The initial good news is that your real estate portfolio can contain both investor and dealer properties. The additional good news is that you are in control, and by knowing just a few rules about dealer and investor classifications, you can do much to increase your net worth.

You have two good reasons to get your qualified small-employer health reimbursement arrangement (QSEHRA) in place on or before October 2. First, this avoids penalties. Second, your employees will have the time they need to select health insurance before your plan year begins on January 1.

Selling your rental property can result in a substantial tax bill. To assist you with this situation, we have developed a guide that presents a variety of tax strategies that can be employed to minimize, and in certain circumstances eliminate, these taxes. You can download this guide and explore the various strategies it contains.

You can grow your real estate portfolio and compound your tax savings by combining a 1031 exchange with a cost segregation study. When you use this combination, make sure to consider the election under IRS Reg. Section 1.168(i)-6(c)(5)(iv). Its proper use can save you thousands—and of course, failure to use it could cost you thousands.

The savvy real estate investor uses Internal Revenue Code Section 1031 to build a real estate empire without paying federal income taxes. But what if that investor wants to get off the landlord merry-go-round—and avoid paying taxes? As you see in this article, the investor has choices.

When you sell commercial or rental property, you can avoid paying capital gains tax by (1) completing a Section 1031 exchange for another replacement property, or (2) investing all or part of the gain in a qualified opportunity zone fund. Which is best for you depends on your specific goals.

Yes, December 31 is just around the corner. That’s your last day to find tax deductions available from your existing business and personal (yes, personal) vehicles that you can use to cut your 2022 taxes. In this article, you will learn how to find and release tax deductions that the tax code trapped inside your existing business cars, SUVs, trucks, and vans. And you will learn how the Tax Cuts and Jobs Act makes it possible for you to find a big deduction from your existing personal vehicle (note the terms “existing” and “personal”).

Do you like the phrase “tax-free”? If so, spend some time with this article because it shows you 11 tax-free income breaks.

Section 1031 exchanges are a great way to acquire new property without paying tax on the gains from selling old property. But the rules have changed. The Tax Cuts and Jobs Act limits so-called exchanges (they are actually sales and purchases) to real property. Personal property is now boot. New IRS regulations define real property broadly for Section 1031 purposes and allow a certain amount of personal property to be included in an exchange. They also make it clear that the real property owners can use cost segregation and still benefit from Section 1031 exchanges.

You don’t often get the opportunity to even consider making a tax-saving double play. But your personal residence combined with a desire for a rental property can provide just such an opportunity, as you learn in this article.

Tax reform no longer allows Section 1031 exchanges on personal property such as your business vehicle. The trade-in was the most common 1031 exchange of a business vehicle. Now, because of tax reform, the vehicle trade-in is simply the sale of the old vehicle to the dealer and the purchase of a new vehicle. The sale to the dealer creates gain or loss on the sale just as it would on an outright sale.

Section 1031 exchanges are perfect when you are going to stay in the real estate rental or investment business. When it’s time to cash out, you need to look at different strategies that help you avoid taxes and give you cash to spend (liquidity).

Learn how this IRS revenue procedure allows you to avoid taxes on the sale of a personal residence in which you had a home office or that you used as a rental property. The procedure lays out the methodology, which includes using the $250,000 ($500,000 if married) home-sale exclusion in unison with a 1031 tax-deferred exchange to avoid the taxes and enhance your deductions on the replacement home.

The Section 1031 exchange is a great tax planning strategy when you are using it to your benefit. But there are two times when you need to avoid the 1031 exchange so as to come out money ahead. The first is pretty apparent, but it does catch many taxpayers by surprise. The second requires thought and knowledge, as you learn in this article.

Yes, December 31 is just around the corner. That’s your last day to find tax deductions for your vehicles that will cut your 2016 taxes. And with our existing high tax rates, 2016 is a good year to cut your taxes. In this article, you can find and release tax deductions that the tax code trapped inside your existing business and personal cars, SUVs, trucks, and vans.

There are many reasons why you may want to donate your business vehicle to charity, not the least of which is that you’re helping a worthy cause. But if your goal is to couple that good deed with a nice tax deduction, make sure you do the math before you hand over the keys to avoid suffering an unpleasant tax surprise.

The sale or trade-in of a business vehicle has positive or negative tax ramifications. You have a choice in this matter. But first you need to know the dollar amount of your gain or loss. This article gives you the six steps to finding your gain or loss.

Follow these three easy steps to an IRS audit-proof tax-deferred Section 1031 exchange of your SUV for a car.

Did you get big tax deductions using Section 179 expensing and/or bonus depreciation on your vehicle purchases in 2012, 2013, 2014, and/or 2015? If so, you now have a vehicle with a low adjusted basis. That gives you a tax problem when you sell the vehicle. To lessen and possibly eliminate the problem, use a Section 1031 tax-deferred exchange.

Lawmakers did it again. They retroactively reinstated a number of so-called extender laws, including those tax-favored Section 179 expensing and bonus depreciation deductions. Did you buy vehicles and equipment last year? If so, this new law can make you smile, as this article shows it did for Harry Spencer.

It’s November. It’s also the beginning of year-end tax planning time. And for many business owners, it’s car, truck, van, and SUV buying time. The combination of car, truck, van, and SUV buying time and year-end tax planning can help you make a sizable dent in your 2014 tax burden. And if lawmakers get their act together, they could further increase your tax benefits before December 31.

Are you an S corporation owner who takes advantage of the office-in-the-home deduction? If so, here’s good news. With the right tax planning, you can sell your home containing the office and defer or eliminate 100 percent of your tax, including recapture for any depreciation that you claimed. That news should put a smile on your face. Read this article to find out how you can use this strategy to pocket some extra tax dollars.

Here’s a trick question: should you operate your real estate activities as a business or as an investor? If you operate as a business, you can deduct trips to real estate seminars and conventions. But if you are flipping houses, you don’t want business status because that makes you a dealer and taxes you at high ordinary tax rates rather than lower tax-favored capital gains rates. Check out this article about deducting seminars and insights into how the tax law treats dealers, investors, rental properties, and more.

You may not expect to sell your current home or vacation property any time soon, but you should take these (easy) steps right now to prepare for—or better yet, avoid—the tax burden when that day ultimately comes. If you plan to rely on the home sale gain exclusion to shield all of your profit, don’t do that. We’ll tell you why not in this article. We’ll also show you how certain records can substantially reduce the taxes you owe on the sale of your home.

Tax law grants depreciation deductions. That’s good. It then recaptures or otherwise taxes the deductions you claimed. That’s bad. Don’t let depreciation and Section 179 deductions hoodwink you. Because of the back-end tax, the deductions amount to less than they appear on the surface. This means tax planning is in order if you are to pocket more tax money. This article helps you with that tax plan so that you get more out of your depreciation and Section 179 deductions.

When you incorporate your business, you have to decide which assets you want to contribute to your new corporation and which you want to keep in your own name. For some assets, you get better tax benefits and better liability protection when you don’t transfer them to your corporation.

You likely have a handle on how the acquisition of a new asset is going to give you tax benefits. But have you considered the asset you are replacing? Your first step with the asset that’s going good-bye is to see whether you have a gain or loss. If you have a loss, see last month’s article. If you have a gain, take this short test to make sure you are getting maximum tax benefits.

Say you inherit an annuity. That’s nice. But when you examine the annuity you find that it’s a bad investment; what can you do about it? Answer: plenty! This article shows you how a Section 1035 tax-free exchange can work to your benefit. Note the words “tax free.” That’s lovely, a tax-free fix for a bad annuity.

How would you like to buy a small business, sell it at a huge profit, and defer the taxes as if you had completed a tax-deferred exchange? You can. It’s not a Section 1031 exchange. But it can give you the same exact tax deferral that you can achieve with a Section 1031 exchange. You find this great benefit in Section 1045 of the Internal Revenue Code.

If you wreck your business vehicle, you will like the involuntary conversion rules that allow you to defer any taxable gain, providing you replace the vehicle within two years. This is true regardless of how you operate your business, corporation, or proprietorship.

Antique desks, clocks, cabinets, bookcases, rugs, conference tables, paperweights, and even cars can add character and beauty to an office. Antiques also make a great investment because they appreciate in value. And here’s one more neat thing about antiques: you can expense them under Section 179 of the tax code if you (1) actually use them to conduct business; and (2) such use causes wear and tear to the antique.

If you own rental properties, enjoy being in that business, and want to grow that rental property business, you need to know the ins and outs of the Section 1031 exchange. The word “exchange” is misleading; what you really do in a 1031 is sell an existing property and then buy a new property, but you do this using an exchange intermediary. It’s easy and the intermediary is not expensive. In this article you will learn how to avoid Mr. Adams’s fate as we follow him to court with an exchange that involved a rental to his son that raised issues with the IRS.

As a subscriber, you likely remember that the trade of a business car for another business car is a Section 1031 exchange. Most businesspeople and real estate investors use the 1031 exchange to avoid paying taxes on the profits that would exist if the asset had been sold outright. In this article, you see how poor Mr. Bird made a $47,000 tax loss not deductible because he used Section 1031 when he traded in his old car on a new car.

Learn how this IRS Revenue Procedure allows you to avoid taxes on the sale of a personal residence in which you had a home office or that you used as a rental property. The procedure lays out the methodology, which includes using the $250,000 ($500,000 if married) home-sale exclusion in unison with a 1031 tax-deferred exchange to avoid the taxes and enhance your deductions on the replacement home.

The sale or trade-in of a business vehicle has positive or negative tax ramifications. You have a choice in this matter. But first you need to know your gain or loss. This article gives you the six steps to finding your gain or loss.

The first good news is that you can be both real estate investor and real estate dealer with respect to your real estate portfolio. The next good news is that you are in control, and by knowing just a few rules about dealer and investor classification, you can do much to increase your net worth.

IRS mileage rates contain a depreciation surprise for many taxpayers. The depreciation might be hiding cash that can be yours with a simple strategy.

Section 1031 exchanges are perfect when you are going to stay in the real estate rental or investment business. When it’s time to cash out, you need to look at different strategies that help you avoid taxes and give you cash to spend (liquidy).

This article gives you the nuts and bolts of the Section 1031 real estate exchange, including how with proper planning the Section 1031 real estate exchange can be nothing more than the sale of your old real estate and the purchase of the replacement real estate.

Wow! This new IRS private ruling expands the number and types of like-kind vehicles available for Section 1031 exchanges.

The tax-favored like-kind rules for personal property such as cars contain a number of twists. For example, trading a car for an SUV, a crossover vehicle, or another car qualifies as a like-kind trade. But the trade of a car for a pickup truck is not like-kind.

The very first thing you need to do once you make the decision to buy the new asset and replace the old asset is to calculate your taxable gain or deductible loss on the old asset (as if you were going to sell it right now). The result—gain or loss—determines the strategy you should follow.

When you claim a Section 179 expensing deduction, you make a deal with the government. You agree to give back your early tax benefits if, during the recapture period, your business use drops to 50 percent or less.

The trade of a vehicle on a lease is not a like-kind exchange. It is more like a cash sale, which has its benefits. You can get big deductions if you do it right.

If you sell an asset, you should know the details about depreciation and Section 179 expensing. You can sell or trade, and choose if you want an intermediary. The result: you could save a lot of money.

The trade-in of an old business asset on the acquisition of a like-kind replacement business asset is a tax-deferred exchange, exempt from depreciation and Section 179 recapture. Use this to your advantage and save money every year until you die.

Big changes have happened to financial instruments in the last few years. You can take advantage of a new tax law that allows one to exchange one annuity for another, and save in tax deferments.

The two most magic words in tax law are “safe harbor.” Why? Clarity! There is nothing better than true clarity in the tax law. The IRS has created a safe harbor for exchanges of homes, and gives us very clear parameters on how to use them.

When you use an intermediary to complete a Section 1031 exchange, you sell one property and place the cash on deposit with the intermediary. If the intermediary goes bankrupt causing your exchange to fail the time test, you are on the hook for the taxes.

Tax-deferred exchanges apply to insurance as well as real estate. There are very specific rules about the transfer of funds, so make sure you do it right.

You can use the 1031 exchange to defer taxes when you exchange one rental property for another. Specific rules apply when determining whether a vacation home is a personal residence or a rental property, though, so make sure you know the rules. A slip up here could mean a lot of money in taxes.

The tax rules make your vacation home either a personal residence or a rental property. When you qualify the vacation home as a rental property, you then may use the Section 1031 rules to defer taxes and build more net worth.

The SUV is like-kind property to the hybrid car. Thus, you can trade or use an intermediary to complete a Section 1031 tax-deferred exchange of an SUV for a hybrid car.

You apply the new trade-in adjustment rule to find your new depreciable basis. When you have the combination of an expensed asset and an upside down loan balance, you can generally ignore your personal use and follow the cash outlay to your new basis.

How you depreciate property has significant effects on your after-tax cash realization. Further, the punitive effects of depreciation recapture taxes make the Section 1031 exchange possibilities more and more appealing. That’s why it is important to remember the eight financial planning principles about depreciation.

The trade of a car on a lease is not a like-kind exchange. This is a sale of the old car and a lease of the new car. The sale part gives you a gain or a loss. In addition, the sale part generates a prepayment on the lease where you benefit with an amortization deduction.

Shared equity is tax law’s officially designed rent-to-own your home program. For this to work, it takes two parties: (1) a landlord-investor and (2) a tenant-investor. The landlord-investor benefits because he has no vacancies, few hassles, no management fees, and a known cash flow. The tenant-investor benefits because he gets into this home with little or no down payment, builds equity while paying rent, and gets detailed knowledge about the property while living there. At some agreed future point in time, the landlord-investor sells his or her interest in the property to the tenant-investor or the two of them sell the property to a third party.

You probably should hate the IRS for the mileage rate. First, the mileage rate creates the illusion that you don’t need a mileage log (wrong!). Second, individuals who start in business think that the mileage rate makes their tax life easy and that it doesn’t make much difference financially (generally, wrong). Third, mileage-rate addicts think that the mileage rate takes care of everything—then they cost themselves money by failing to deduct a loss on the sale of a business vehicle and overlook the business person’s tax deduction for interest on a car loan.

The commission on sale does not make or break a Section 1031 exchange. The trick to the Section 1031 exchange is in the first step.