Real estate is a tax strategy.Only if it’s planned that way.
Depreciation, cost segregation, entity structure, 1031 exchanges, passive activity rules and exit planning for investors with rentals, short-term rentals and commercial property.
Tell us what you’re working on and we’ll determine whether BigApple is the right fit.
Investors often own the right assets with the wrong tax setup.
Planning across the life of a property.
Every engagement is based on your facts. We do not promise a specific tax outcome.
Applied to a real estate portfolio.
Cash Flow → Assets → Tax Planning
CASH FLOW
Rents, operating costs, debt service, reserves and distributions from each property.
ASSETS
Properties, entities, financing, depreciation schedules and equity built over time.
TAX PLANNING
Use depreciation, timing and structure deliberately, and plan the exit before you sell.
You may be a fit for BigApple if…
If you own a single long-held rental with no plans to change it, a full planning engagement may be more than you need.
- You own several properties or one large one
- You are buying or selling in the next 12 months
- You have rental losses you have never been able to use
- You operate short-term rentals
- You feel like your CPA is documenting the past instead of helping plan the future
- You want real estate decisions reviewed before they close
How the decisions connect.
CLIENT PROFILE
A high-earning W-2 professional owns two long-term rentals, is buying a short-term rental and plans to sell an appreciated property in the next two years.
THE PROBLEM
Purchases, rentals and a planned sale were being decided one property at a time.
WHAT WE REVIEWED
- Cash flow
What do the properties produce after debt service and reserves? - Depreciation
Would a cost segregation study on the new purchase change this year’s result? - Passive rules
Can the short-term rental losses offset W-2 income, and what participation is required? - Entity structure
How should each property be owned for liability and tax purposes? - Exit planning
What recapture and gain will the sale trigger, and is a 1031 exchange appropriate? - Estimated taxes
How will the sale year affect quarterly payments? - Year-end planning
Which purchases and placed-in-service dates matter before December 31?
THE STRATEGY
- Portfolio-wide projection
- Cost segregation evaluated on the new purchase
- Short-term rental participation documented
- Exit and 1031 options modeled before listing
THE RESULT
One coordinated plan instead of separate decisions. Any tax effect depends on the client’s actual facts, so we don’t show a savings figure for a hypothetical example.
Hypothetical scenario for illustration only. It does not describe a specific client and does not promise any result.
Real estate tax planning, explained.
Questions real estate investors ask us
Can my rental losses offset my W-2 income?
Usually not. Rental losses are generally passive. There is a limited allowance for active participants that phases out at higher incomes, and exceptions for real estate professionals and certain short-term rentals.
What is a cost segregation study?
An engineering-based study that reclassifies parts of a building into shorter depreciation lives, which can accelerate deductions. Whether it helps depends on your ability to use the losses.
How do short-term rentals change the rules?
If the average guest stay is seven days or less and you materially participate, the activity may not be treated as passive. The participation tests are strict and need documentation.
Should each property be in its own LLC?
That is mainly a liability question for your attorney. A single-member LLC usually doesn’t change how the property is taxed, but the overall structure should be planned together.
What happens when I sell a rental?
You may owe capital gains tax, depreciation recapture and possibly net investment income tax. Planning the sale in advance gives you more options.
How does a 1031 exchange work?
You defer gain by reinvesting in like-kind real property, with strict 45-day identification and 180-day closing deadlines and a qualified intermediary.
Your tax return tells us what happened. Your tax plan determines what happens next.
SCHEDULE A CONSULTATIONBest for investors with multiple properties, upcoming purchases or sales, or short-term rentals.