3 real estate tax tactics — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily
  • LinkedIn
  • YouTube
  • Twitter
  • Facebook
  • Google+

3 real estate tax tactics

Get PDF file

by on
in Small Business Tax,Small Business Tax Deduction Strategies

Real estate values are scorching hot in many parts of the United States. If you're sitting on some big-time appreciated property, check out the following three strategies for minimizing your tax bill:

Strategy 1: Establish an S corp to develop and sell appreciated land

Say you own acreage (individually or in partnership with others) that's ripe for subdivision into lots that you could sell off for major gains. Your tax planning goal here is to characterize as much profit as possible as long-term capital gain, which is eligible for the ultralow 15 percent maximum federal capital-gains rate.

That requires some planning because the tax code generally treats subdividers as "dealers" in real estate. Lots owned by dealers are considered "inventory." And profits from inventory sales are considered ordinary income taxed at your regular federal rate (up to 35 percent). Ugh!

Cut tax on pre-development appreciation

The g...(register to read more)

To read the rest of this article you must first register with your email address.

Email Address:

Leave a Comment

Previous post:

Next post: