As I mentioned last week, real estate is one of my absolute favorite areas in the tax law because there is so much flexibility in how to do things to legally maximize the tax benefits available.
Real estate is also one of the most complex areas of the tax law. This makes it easy to overlook important steps, which can lead to missing out on tremendous tax savings.
I recommend reviewing your tax strategy throughout the year, particularly as it relates to real estate. This makes it much easier to make adjustments timely, minimize oversights and reduce stress at the end of the year and tax return time.
With the end of the year approaching quickly, it is an ideal time to implement a year round strategy to review your tax strategy as it relates to your real estate. Start with my year-end checklist for rental real estate and then adapt it to use throughout the year.
Year-End Checklist for Rental Real Estate
As I noted above, real estate is one of the most complex areas of the tax law. This checklist uses terms and concepts that are directly from the tax law.
Here are a few items from the checklist my team and I use when working with clients:
Understand Your Losses Understand how your real estate losses impact your taxes.
Rental real estate losses have very specific rules. Understanding these rules is the first step to understanding how your real estate losses impact your taxes.
Don’t assume it will be the same as last year! Sometimes a minor change can impact how your real estate losses are treated so this is an important item to review every year payday loans no credit check.
