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10-08-2008, 08:24 PM
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Senior Member
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Join Date: Apr 2007
Location: San Antonio, Tx.
3,450 posts, read 2,256,094 times
Reputation: 1113
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Advice on taxes and real estate
hey, I recently sold an asset and now have around 7,500 I gotta give to the IRS on April. however, there is some real estate i want to buy this month and was wondering if there's some kind of way I can avoid the taxes by buying real estate.
Any possibilities out there?
The asset was not real estate...so I can't do the 1031 exchange.
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10-09-2008, 11:52 AM
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Senior Member
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Join Date: Oct 2007
840 posts, read 509,973 times
Reputation: 366
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Buy investment property and claim depreciation on the property.
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10-09-2008, 01:16 PM
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Not a member
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Join Date: Feb 2008
1,305 posts, read 528,070 times
Reputation: 238
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Quote:
Originally Posted by Naptowner
Buy investment property and claim depreciation on the property.
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You can't depreciate land. Not sure about housing, but I generally think that's hard to depreciate since real estate traditionally goes up. |
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10-09-2008, 02:04 PM
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Senior Member
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Join Date: Oct 2007
840 posts, read 509,973 times
Reputation: 366
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Right, I wasn't referring to raw land. You can claim depreciation on property regardless of whether it is actually appreciating, but doing so lowers your basis on the property, so that when you sell you 'recapture' the depreciation which will be counted as income. You can mitigate this by doing a 1031 exchange instead of selling, but at some point taxes will likely be due. The OP might also be able to buy property and write off the interest, which would reduce the taxes due. There are some options out there, but a good accountant or tax lawyer would be the best source of advice here.
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10-09-2008, 02:59 PM
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Senior Member
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Join Date: Apr 2007
Location: San Antonio, Tx.
3,450 posts, read 2,256,094 times
Reputation: 1113
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Thanks, folks!
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10-09-2008, 03:18 PM
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Real Estate Broker
Status:
"If you find yourself in a hole, quit digging."
(set 14 days ago)
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Join Date: Jul 2007
Location: Mountain Ranch, CA The heart of Calaveras County
2,488 posts, read 2,111,831 times
Reputation: 984
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Quote:
Originally Posted by bigtrees
You can't depreciate land. Not sure about housing, but I generally think that's hard to depreciate since real estate traditionally goes up.
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Actually the building has what is called a useful life. Usually it is about 40 years. In the simplest example say you buy a rental property for $50K and the land is valued at $10K, you would be able to claim $1K per year as depreciation. |
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10-10-2008, 09:09 AM
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Senior Member
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Join Date: May 2008
1,151 posts, read 598,420 times
Reputation: 191
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Sell some stock. Odds are you would have a loss that could at least partially offset your capital gains.  |
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