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Rental Property Tax
Tax treatment is where buy-and-hold quietly wins. Depreciation, Schedule E, deductions, and the 1031 exchange can turn positive cash flow into a paper loss. These guides explain the mechanics — then verify your specifics with a CPA.
Guides
Rental property tax deductions — the 14 every investor should know
Every deductible expense on a rental property, organized by Schedule E line. Worked examples, common-mistake callouts, and the depreciation move that often saves more than all other deductions combined.
11 min readDepreciation recapture on rental property: how the tax works when you sell (2026)
Depreciation lowers your basis every year — and recapture taxes the gain that creates when you sell, at up to 25%. A full worked example on a $250K rental sold for $360K, why the real bill is 2.4x the naive estimate, the §1245 cost-seg trap, and five ways to defer or erase it.
11 min readSchedule E for rental property: a line-by-line walkthrough (2026)
Every Schedule E line that matters, a full worked example on a $250K rental, and the exact bridge between +$139/month of cash flow and a $3,703 paper loss — plus the $25K passive loss allowance, its MAGI phase-out, and the four mistakes that cost real money.
10 min read1031 exchange basics for individual rental investors
How a 1031 exchange actually works in 2026 — the 45-day and 180-day windows, qualified intermediary requirement, like-kind rules, boot, reverse exchanges, and when it's worth the complexity.
11 min readShould you put your rental property in an LLC? (2026)
An honest answer to the most-asked entity question. What an LLC does (liability) and doesn't (cut your taxes), the Garn-St. Germain due-on-sale trap when you transfer a mortgaged rental, why a conventional loan won't follow you into an LLC, the 2026 Corporate Transparency Act reversal that exempted domestic LLCs from BOI filing, and when it's actually worth the cost.
12 min readBonus depreciation on rental property in 2026: the restored 100% deduction and what qualifies
Current IRS guidance restored 100% bonus depreciation for eligible property acquired and placed in service after January 19, 2025. The rental building itself usually does not qualify; certain shorter-life components can.
10 min readProperty tax reassessment: don't underwrite the seller's tax bill (2026)
The most expensive shortcut in underwriting is copying the property-tax line straight off the listing. Why the seller's bill reflects a capped, years-old assessment and an owner-occupant exemption you'll never get, how a sale resets taxes toward your purchase price (Prop 13 and the cyclical-reassessment states), the supplemental bill that lands after closing, and a worked $400K duplex where a $3,400-vs-$6,000 tax line drops the cap rate 0.65 points, pushes DSCR from 1.00 to 0.90, and swings cash flow from +$9 to −$208 a month.
10 min readCalculators for this
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