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December 18, 2023 | read

Three Quick Easy Fixes With Real Estate Taxes

Brandon Hall

In prior blogs, we talked broadly about how so many property owners and investors have trouble making their tax filings efficient and finding effective ways of keeping money in their pockets.


Even professional tax preparers may not be specialized in how to report real estate profits, as well as appropriate and relevant losses, on an annual filing.


With that in mind, let’s just briefly go over a few of these relatively simple changes that people miss because of confusing jargon and abstract treatment of assets in their annual filings.


Partial Asset Dispositions


This term, at first glance, really doesn’t sound like anything. The word “disposition” is particularly troubling, because it really hides the nature of what this filing aspect really is.


A “partial asset disposition” is when you write off the value of some element of a property. This is often relevant when something gets fixed or replaced. But this type of write-off gets missed all the time, partly because of the language. It’s part of a property, so it’s “partial.” It’s an asset. And there’s a “disposition,” which is the write-off. But without detailed specialization, so many people really don’t understand what this is about.


9(g) Election


What is this, Greek?


No, it refers to designating a group of properties as one single investment. But it has an extreme effect on your time management and how you are required to administrate properties. You’ll see more on the website about this aspect of real estate reporting.


This is another one that just mystifies people, because the term itself is an alphanumeric hash that doesn’t describe what you’re using this element of a return for.


Carrying Forward Suspended Passive Losses


This is another type of obscure annual filing reporting. Essentially, using a particular form and structure allows you to carry some types of losses forward over a number of years, but only if this is done the right way.


You can see why so many bright and industrious real estate holders and investors go glassy-eyed when you start talking about some aspects of annual tax filing. People just aren’t up to the challenges of learning a lot of this from scratch, when they also have to understand their core business strategy and how to administrator assets day to day. That’s why they turn to skilled offices like the Real Estate CPA.


We help clients to go the distance with their investments and keep all of their ducks in a row for annual filing in a way that benefits their bottom line. Get connected and save!