If you spend the entire $300k restoring the property, then here is the end result:- deductible casualty loss of $50k- no current tax- the restored property has $0 basis and cannot be depreciated- when it is later sold, the entire sale price is taxableMechanics and reporting are tricky, and I would not recommend to DIY it, especially since my scenario is over-simplified, and your real scenario is likely to involve more gotchas.Thanks so much. 

In that case, using the cost segregation study this year might not be necessary because the extra depreciation would just increase your loss, which you might not be able to fully use right now.However, you have two options:Use the Cost Segregation Now: This would increase your loss this year, and you could carry forward the unused loss to offset future rental income.

Last I checked Chat GTP was making up tax court cases. 

It's absolutely crucial investors know if they can or cannot use losses. 

But very few investors are in the #1 performing sector over the last 1, 3, 5 and 10 year periods, according to the National Council of Real Estate Investment Fiduciaries (NCREIF): senior housing.  

T First person I've heard say I look forward to the losses.

A real estate-focused CPA can help maximize deductions, structure tax-efficient strategies, and navigate complex rules like passive loss limitations and cost segregation.

Understanding when to cut your losses and sell a poorly performing investment is one of the most difficult decisions a real estate investor must learn to make.

This is the story of how I went from cold calling in a closet to owning a wholesaling business that did just under one million dollars in net revenue last year.

Quote from @David Brooks: I've received advise that our friendly STR loophole can not be used to characterize STR income/loss as non-passive on a California tax return.