why real estate investments?
6. tax incentive
4 ways Real Estate can take advantage of the new Tax Act of 2018 1-199A
1 – New 199A: Pass-through Deduction to Qualify for the 20% Deduction.
2 – 20% Deduction on Taxable Income.
3 – 100% Bonus Depreciation.
4 – Avoid Real Estate Tax with Section 121 together with 1031 Exchange.
The Incredible Tax Benefits of Real Estate Investing
Because the cost of real estate is so large and often purchased with debt, the tax rate on this recaptured real estate depreciation is usually 25%. This creates a big incentive to keep real estate or to use other tax savings strategies when selling, like a 1031 exchange.