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Updated almost 5 years ago,
Newbie question on personal income and rental income deductions
Long time lover of real estate but relative newbie to investing. It’s tax Season and in doing our 2019 taxes I asked about strategies for reducing taxes. I made just shy of $100k last year and want to start investing in buy/hold rentals this year. My day job is commissioned sales and I could realistically see $125k - $150k in 2020. I asked how having rentals would affect my tax situation. Her advice was to keep my overall total income under $150k or I would have to defer deductions for rental expenses or even potentially loose them all together. I know the tax laws have changed a lot in recent years, but I thought deductions on expenses and depreciation and other “costs” were one of the huge benefits of investing in real estate? Or am I misunderstanding what she’s telling me.