Tax strategy built for real estate investors

Depreciation guidance

Depreciation is the largest non-cash deduction in most real estate portfolios — and the area where the right CPA pays for themselves many times over. Residential rentals depreciate straight-line over 27.5 years; commercial over 39. Cost segregation studies reclassify 20–35% of basis into 5, 7, and 15-year property, pulling huge deductions into year one and pairing well with bonus depreciation.

• Cost segregation studies for properties over ~$500K basis
• Bonus depreciation strategy (60% in 2024, stepping down)
• Section 1250 recapture planning at sale and via 1031
• Short-term rental (STR) loophole and material participation

Investor accounting

Active investors typically operate through a stack of LLCs and partnerships. The right CPA structures entities for liability, financing, and tax efficiency — then keeps the partnership returns, K-1s, and capital accounts clean year after year. For syndicators and funds, that work expands to waterfall calculations, preferred returns, and investor-level reporting.

• Entity structure (LLC, series LLC, holding co) and operating agreements
• Form 1065 partnership returns and K-1 issuance to investors
• Capital account tracking under tax basis and §704(b)
• Syndication waterfalls, preferred returns, and promote calculations
• Real Estate Professional Status (REPS) qualification and documentation

Rental property bookkeeping

Clean rental books make the difference between a one-week tax engagement and a four-week cleanup. A real estate bookkeeper tracks income and expenses at the property level, reconciles bank and mortgage accounts monthly, handles security deposits as liabilities, and produces a Schedule E-ready package each January.

• Per-property P&L and balance sheet in QuickBooks, Stessa, or Rentec
• Monthly bank, mortgage, and CapEx reconciliation
• Security deposits tracked as liabilities, not income
• Capital improvements vs repairs — correctly classified for depreciation
• Year-end Schedule E package for your tax preparer

1031 exchanges and dispositions

A 1031 like-kind exchange defers gain and depreciation recapture indefinitely — but only when the strict 45-day identification and 180-day close timelines are met with a qualified intermediary. A real estate CPA coordinates with the QI, calculates boot, and updates basis on the replacement property.