Tax Advantages of Owning Income-Producing Real Estate
by Catherine Paret

1- Interest on loans used to purchase or improve rental real estate is fully deductible against the rental income.

2- For income property owners, repairs, management, maintenance, insurance, property taxes, and other operating expenses are deductible.

3- Income property owners can take depreciation (cost recovery) deductions to shelter rental income.

4- Upon resale, if a property was held by an investor for the statutory time, it may qualify for favorable capital gain treatment if allowed at that time.

5- A real estate investor is allowed installment sale reporting when the property is sold and the seller carries financing( paper). This may save the seller income taxes by pushing a part of the taxable gain into a lower tax bracket in future years.

6- If the investor follows the rules of Internal Revenue Code Section 1031, a real estate exchange can be used to defer all gain and taxes into another like-kind property.

Just a few tips from your CT Commercial RE Agent..

Company Name: Matthews Commercial Properties LLC
Website: www.matthewscommercial.com
Author: Catherine Paret
E-Mail: mcpcathy@snet.net
Address: 969 West Main St Suite 3C
City: Waterbury
State: CT
Zip: 06708