How to Leverage Real Estate to Avoid W-2 Taxes

🏠Real estate can be used to offset taxable income from sources like W-2, 1099, crypto, and stocks.

📚Passive activity loss rules were implemented in 1987 to separate passive income from non-passive income.

💡Cost segregation studies allow real estate investors to allocate the cost of components inside their property and write them off over shorter durations.

💼High net worth individuals and business owners can benefit from using real estate to reduce their tax bill.

⏳Real estate depreciation can create paper losses that offset non-passive income and reduce taxable income.

How can real estate offset taxable income?

—Real estate depreciation and expenses can create losses that offset income from sources like W-2, 1099, and investments.

What are passive activity loss rules?

—Passive activity loss rules were implemented in 1987 to separate passive income from non-passive income for tax purposes.

What is a cost segregation study?

—A cost segregation study is a process of reclassifying components inside a property to accelerate depreciation and create larger tax deductions.

Who can benefit from using real estate to reduce taxes?

—High net worth individuals, business owners, and investors can benefit from using real estate to reduce their tax bill.

How does real estate depreciation reduce taxable income?

—Real estate depreciation creates paper losses that offset non-passive income and reduce taxable income.

00:00Learn how to use real estate to offset your taxable income and avoid taxes on your W-2 income, 1099 income, crypto, stocks, and more.

07:43Passive activity loss rules were implemented in 1987 to separate passive income from non-passive income.

11:36Cost segregation studies allow real estate investors to allocate the cost of components inside their property and write them off over shorter durations.

19:45High net worth individuals and business owners can benefit from using real estate to reduce their tax bill.

25:25Real estate depreciation can create paper losses that offset non-passive income and reduce taxable income.