Let me know if there is a taxable issue, as that plays on my assumptions for the deal as well as your father's willingness to remain involved.

The S-corp in question owns a 94 unit complex, 2 homes, and 3 condos.The rule is that BIG Tax is calculated on the lesser of the amount of the recognized built in gain or the corporation’s taxable income if the S corporation was a C corporation.

This is tremendously significant because for the R/E pro, enough current year bonus depreciation to create a “negative taxable income†(subject to some very minor conditions) will usually result in an NOL.

There are rules in place about the plan providing a direct benefit to yourself thru the plans investments, but in most cases the investments would be passive (my plan invests in real estate notes and real estate limited partnership interests). 7- Under current law, the plan withdrawls are taxable as ordinary income.

Your "basis" in the property, which is the amount you subtract from the sales price to determine the taxable gain, goes down as you take the depreciation.

If any debt is forgiven the amount forgiven is considered income to you and is taxable - this would increase your reported income not decrease it.

I like the idea of dictating what my income is and how much of it is taxable.

Just to clarify here, Dave Savage, are you referring to a situation in which you and one or more associates, all having SDIRAs, would make loans to each other, which proceeds each would use to generate regular taxable income?

No one at the lending institution will talk to you on this basis.2- The demolition of the property is a violation of the deed of trust but is in no way a short sale as no sale has taken place.3- The taxable value of a property may or may not bear any relationship to it's market value.4- The owner always has recourse to keep the property - he can satisfy the lien in full or negotiate a partial settlement. 5- There is no automatic loss of property provision for ANYTHING, not even property demolition.

Yes, you can reduce the taxable income by the depreciation amount.