- Run a cost segregation study on this property in 2024 and you might have $100k on line 18...Without diving too deep on this post - If you run this scenario as a real estate professional while materially participating in the property, You'll be able to reduce your's and your spouses taxable income that year... 

If you do so - 100% of the cash converted is taxable.

What is the difference between the Taxable Value and the SEV value? 

Two things are certain, 1) taxes are lower today than they've ever been in the past 80 years. 2) they are certain to be higher in the future.We should all be focused on paying the lowest “lifetime tax bill” not the “lowest tax bill this year”.By paying 20% and settling up my long-term capital gains is not a bad deal.

Transferring a property title later could be deemed a taxable gift if it exceeds the annual exclusion ($17,000 for 2024).

Private funding from a relative may provide flexible terms and reduced financial risk, but formal agreements are necessary, and interest paid is deductible for you but taxable for them.Traditional investment property loans offer stability and tax benefits like deductible interest and property taxes but require larger down payments.

This allows for deferral of capital gains taxes until December 31, 2026, with potential reductions in the taxable amount if held long-term.

Once in service, expenses become deductible, reducing taxable rental income.This post does not create a CPA-Client relationship.

If I choose the rental, then all income generated will be taxable income moving forward, because none will be off-set by the interest I could deduct.  

If you did, you could take advantage of some unique strategies, like renting it out while traveling (as long as it’s for 14 days or less) and having that rental income be completely non-taxable.