The promise of accelerated depreciation and immediate tax savings is attractive.

In that case you might save taxes building with them.

Consult your local CPA to calculate accurately and minimize your tax liability.

@Samuel KimBigger Pockets is a great place to find a tax accountant specializing in real estate taxation.A good real estate accountant can save you thousands of dollars by leveraging entity selection and formation, tax deductions, cost segregations, bonus depreciation and tax planning.I recommend finding an accountant specializing in real estate taxation, business taxation, financial planning and tax planning.Consider working with your accountant remotely to expand your options.I would also recommend looking for an accountant willing to work with you throughout the year.

If you do not get that tax credit its usually not profitable. 

In doing so, bear in mind that the cost and admin of a corporation is higher and that the tax treatment is different:1.

Intangible assets like goodwill or tangible personal property (e.g., equipment) are excluded from 1031 treatment and are taxed separately—goodwill is typically taxed as a capital gain, while equipment may be subject to depreciation recapture taxed as ordinary income.To minimize taxes on the sale of the business, consider strategies such as Opportunity Zone investments, which defer gains until 2026 if proceeds are reinvested in a Qualified Opportunity Fund (QOF), or structuring the sale as an installment agreement to spread taxable income over multiple years.

I assume there is zero or almost zero appreciation and that’s the reason you aren’t selling tax free?

However, in California, each LLC incurs an $800 annual franchise tax plus gross receipts fees if revenue exceeds $250,000, and property insurance may cost more.

Recapture typically happens only when you sell the property.If you use the property partly for personal use and partly as a rental in a given year, depreciation and other expenses must be prorated based on the number of days it was rented versus personal useBased on the current tax laws and regulations, once you've taken bonus depreciation on an asset, you cannot "capture" additional bonus depreciation on that same asset in future years, even if the rates increase.In the 2024 tax year, the rate for bonus depreciation is 60%.