Tax Planning and Real Estate

The conversation regarding which investments to use for tax planning starts with looking at your income level and how it is taxed.

For high - net worth or accredited investors, there could be certain benefits that come from investing in real estate. The amount of tax savings is dependent upon your level of passive income and the type of real estate investment.

I cautious though, investing in a real estate investment solely because of its tax benefits is a faulty premise. 

Any real estate investment to be considered should be based on the merits of the investment and whether that investment is in alignment with your overall investment strategy. 

We call this 'highest and best use'

Choosing The Right Asset Class

Real estate properties fall into different asset classes including:

  • Convenient store
  • Industrial
  • Medical
  • Multi-family 
  • Senior living facilities
  • Student Housing
  • Office
  • Retail
  • Hospitality
  • Self-storage
  • Mineral rights (e.g. investments in minerals beneath the ground)

What we are describing above is institutional real estate. 

Looking at your level of income

Our advanced tax planning process can be helpful to those individuals earning $100,000 of passive income and married couples filing jointly with $628,300. 

The goal of this type of tax planning is to remove dollars from the highest bracket, which is currently 37% federal. 

The potential outcome is tax savings while investing in institutional real estate.  

Looking at the code

There are provisions within our tax code that affect how your passive income is treated. The codes provide advanced tax planning benefits and opportunities. Understanding these benefits and opportunities is what advanced tax planning is all about. 

Tax planning is typically done in the second half of the calendar year. This is the ideal time to consider various scenarios and their potential outcomes. 

If your current tax professional has not provided you with tax planning strategies that can potential save you $100,000 in taxes, it may be time to add us to your team. 


Specialized Tax Planning Consulting


Tax Planning for High - Net Worth