🏠Real estate allows for building wealth and reducing taxes simultaneously.
💸Passive activity loss rules limit the use of real estate losses to offset active income.
📚Eleven real property trader businesses qualify for converting passive losses to active losses.
💡Depreciation is a key factor in creating real estate losses.
💰Maximizing tax savings with real estate involves understanding depreciation and the real estate professional status.
How can I use real estate to reduce my taxes?
—By creating losses through depreciation and utilizing the real estate professional status to offset your W-2 and 1099 income.
Which businesses qualify for converting passive losses to active losses?
—The eleven real property trader businesses include property development, redevelopment, construction, acquisition, conversion, rental, and management.
What is depreciation and how does it create real estate losses?
—Depreciation allows you to recover the cost of wear and tear on your rental property over time, resulting in deductions and paper losses.
What is the real estate professional status?
—The real estate professional status allows you to use real estate losses to offset your W-2 and 1099 income if you qualify as a real estate professional.
How can I maximize my tax savings with real estate?
—Understanding depreciation, creating real estate losses, and qualifying for the real estate professional status are key to maximizing tax savings with real estate.
00:00Discover how to use real estate to reduce taxes and create wealth.
03:27Passive activity loss rules limit the use of real estate losses to offset active income.
05:34Eleven real property trader businesses qualify for converting passive losses to active losses.
08:02Depreciation is a key factor in creating real estate losses.
10:26Maximize tax savings by understanding depreciation and the real estate professional status.
