Tax Benefits of Investing in CRE?
Not an expert on the matter and would like to learn more...
What are the tax benefits of investing in CRE? Familiar with 1031, interest expense deductions, and depreciation at a high-level but can anyone provide anecdotally the favorability of investing in CRE from a tax standpoint?
What are some tax plays that are of common use in the industry? Is it possible to pay no taxes at all and still turn a large profit?
Cash flow generally exceeds taxable income until you burn through your depreciation. You can also generate tax free windfalls via a cash out refi once your equity position is sizable enough and then use the proceeds to leverage up and buy another asset with the same tax benefits.
For those wondering, the proceeds from a refinance are not taxable because technically you have to pay it back to the lender through the Loan that you got the proceeds from.
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