Why Invest In San Diego Real Estate? PART 4

Why Invest In San Diego Real Estate? PART 4

TAX ADVANTAGES- Whether you are buying your first home in Carlsbad, Oceanside, San Marcos or you are an investor, there are numerous tax advantages that exist!

You can deduct, as an expense, all of the interest, property taxes, insurance, repairs, inspections, and depreciation on your investment real estate- no matter how much you own.

Do not confuse this with the rule for personal residences. While you can only deduct interest on up to 2 personal residences, you can write off unlimited investment interest.

The IRS also allows you to take a paper write off (depreciation). You can depreciate the structure (not the land) as if it would be worth nothing at the end of 27.5 years! Of course we all know that the property will probably be worth much, much more in 27.5 years than it is now -not less. Nevertheless, on a 500,000 house (assuming, for example sake, the structure is worth 80% of the total) we are allowed to write off nearly $15,000 in depreciation alone each year!

Stay tuned for more helpful investment tips!

Marc

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