Deferring Income Tax on Buy and Hold Cash Flow

[Jeffrey Mayer]

Hi Biggerpockets Forums,

I am looking into getting into real estate soon in Georgia and I had an open ended question on tax liability strategies. As a little back story, as a positions investor I am all about the long term benefits of tax deferment. I was curious if there are any strategies that you all use to help limit your tax burden by deferring taxes to when they are, years down the line, used for personal reasons.

Is there a way to avoid paying personal income tax on the cash flow generated from a buy and hold strategy if it is reinvested into more property/debt repayment/capital improvements or does that have to be rerealized as income tax if it is not in corporation of some sort.

AND if I were to create an LLC to hold this property within the LLC would there be tax liabilities for any of the cash flow generated even if it were reinvested directly into the business.

Thank you to everyone in advance who can help me begin to form a long term strategy!

[William "W.J" Mencarow]

Jeffrey, you can buy r.e., notes, etc. in a self-directed IRA. There are lots of discussions about that, as well as some books available. -- Bill