Real Estate


This Newsletter continues the discussion of Tax Reform’s changes to businesses and will primarily cover the phenomenal new depreciation rules.  Perhaps the single biggest change in the entire Tax Cuts and Jobs Act is the move to 100% first-year depreciation for most business assets.  But, this isn’t all.  The new law makes major changes to […]

Beware HELOC Mortgage Accelerator Sales Promotions

The pitch is that their program will help you pay off your home mortgage over a short period of time through the use of a home equity line of credit (HELOC).  You will first borrow against your HELOC and write a check to your mortgage lender to prepay your mortgage.  Then, you will use the […]

Condo Conversions – What are They?

In a condominium, each of the units (apartments or professional suites) is owned individually.  Collectively, the owners of the individual apartments or units own the common space.  It is like buying a private home, except that there is some common property; i.e., hallways, elevators, reception area, etc. A condominium conversion consists of taking an existing […]

Lease Negotiations are Not Always Conducted On a Level Playing Field

The landlord is in the real estate business, and most doctors are not.  With some advanced planning, you can often negotiate a lower rent, receive tenant improvement allowances and maybe even get a few months of free rent. This is particularly true when moving into a new office, but it can also work when you […]

Should You Claim Depreciation on Your Home Office?

Yes.  We’re well aware that the thought of dealing with a depreciation recapture tax when you sell your home may make you queasy, but there are benefits to claiming depreciation deductions – and a big negative if you don’t.  First, the negative.  If you are taking the home office deduction, the government expects you to […]

If You Must Sell Your House at a Loss, Consider First Converting it to Rental Property

The loss on the sale of a residence is “personal” and not deductible.  The loss on rental property is a capital loss and is deductible to the extent of the capital loss deduction rules.  Conversion to rental property is possible but must be genuine (e.g., moving out, renting to a legitimate tenant, etc.).  If you […]

Deducting Real Estate Losses Against Active Practice Income in a Self-Rental Situation

The issue is the very limited ability to deduct “passive” losses from real estate against one’s “active” practice income.  The tax laws say that real estate is “per se” passive which means that unless you can fit into a narrow exception, you can only deduct passive real estate losses against gains from other passive real […]

A Recent Tax Court Case Shows How Husband and Wife Dentists Can Deduct Their Real Estate Losses Against Their Dental Practice Income

One of the more common questions we’ve been getting from seminar attendees looking to save on taxes is how to deduct their real estate losses against their professional practice income.  Thanks to the big depreciation deductions that can be claimed with commercial real estate, the properties can run large tax losses that could ideally be […]

IRS Targets Syndicated Conservation Easements

A conservation easement is a legitimate charitable gift.  The taxpayer donates easements promising not to change the character of the property (historic building, park land, etc.) to a charitable organization which preserves the property in its current form.  But as with anything that can create a deduction, the concept is subject to abuse.  The IRS […]

If You are Renting a Residence for No More Than 14 Days Per Year In Order to Generate Tax-Free Rental Income, this Should be Reported on Schedule E of Your 1040 Tax Return To The Extent You Receive 1099s

As we’ve discussed in prior Newsletters, the U.S. tax code ignores short-term rentals of 14 days or less.  This means that the rental income is tax-free to the owner (and any rental expenses are not deductible).  Typically, you will rent your primary residence (or a vacation home that you use personally at least 14 days […]