Do a cost seg study and take bonus depreciation to offset other income.

My name is Christopher, I have studying real estate investing for probably about 7 years.

You’re correct that prior year losses generally can't offset W-2 income, but any new depreciation from cost segregation studies on properties in 2024 should be eligible.

Relationships are key in this industry.4.Analyze Markets: Whether it’s your local area or out-of-state, study the market’s potential for growth, rentability, and appreciation.5.Take Action: You don’t need to know everything to get started.

In fact, according to a recent study, regulation “imposed by all levels of government accounts for an average of 40.6 % of development costs (NAHB, O’Leary).”

In situations like this, it’s definitely worth considering a cost segregation study.

On average, 20% to 40% of those components fall into tax categories that can be written off much quicker than the building structure.A Cost Segregation study dissects the construction cost or purchase price of the property that would otherwise be depreciated over 27.5 or 39 years.

Just remember for every glamorous flip or lucrative rental, there’s a puzzle waiting to be solved, sometimes involving old graves, sometimes involving new regulations, and always requiring creativity and patience.So, the next time you’re having a bad day—your contractor didn’t show up, a deal fell through, or you just discovered your property has a surprise pool—just remember: at least you’re not trying to figure out where the bodies are buried.

I have not heard of the IRS challenging, much less overturning a professionally done cost segregation study. 

Discover the next day and police came out put in a report and that was about it.