A peak at Donald Trump’s tax returns show some of the huge benefits of owning New York City property regardless of the high costs.
There’s nothing cheap about owning real estate in New York City, or living here for that matter. Yet a leak of Donald Trump’s tax returns by the New York Times reportedly shows an almost $1B tax break, at least partially thanks to the properties he has owned. The income tax returns from 1995 show a paper loss of over $915,000,000. The newspaper proclaims this could have been used to cancel out income taxes for another 18 years.
Whatever the exact true details of Donald Trump’s tax returns and tax breaks the point is that real estate can offer some massive tax advantages. Losses like this may enable investors and business owners to carry over breaks for future year’s tax returns.
This is in addition to a long list of other perks of investing in real estate. These include:
- Cash flow
- Passive income
- Wealth building
- A hard tangible asset
- Ability to help others with their real estate needs
Investment income and taxable gains may also sometimes be taxed at a lessor rate than regular earned income. Some may be tax free depending on certain monetary thresholds. The tax benefits of real estate can be further bolstered by layers of additional legal shelter from taxes. This includes business entities, self-directed retirement accounts (IRAs and 401ks), and section 1031 like-kind exchanges. These latter two can deliver tax deferred and even tax free returns.
Of course it is also wise to be cautious about big promises of tax breaks, write offs, deductions, etc. Legitimate breaks and incentives can change over the years. More importantly taxes are all a personal and individual situation. What may provide a substantial, tangible break for one person, may not help the next much at all.
Real estate investment and ownership also requires expenditures. Property taxes are one of the biggest expenses and burdens for most individuals, businesses, and investors. This includes every home and business owner in NY. Fortunately you can do something about that, without having to get too extravagant, or spending endless hours and sums chasing complex and sometimes illegal tax shelters.
NYC residents are eligible, and even encourages to appeal their annual property tax bills. Everyone should be taking advantage of this opportunity to avoid overpaying taxes needlessly. Find out how Property Tax Adjusters, Ltd. can help you save today…