[USER]

How do you reduce taxes from your W2 jobs through real estate?

We have a duplex and flip that we’re selling soon and are planning to buy another duplex in the near future.

I’m a W2 employee looking for ways to minimize my tax liability legally.

I’ve heard that real estate investments can provide certain tax benefits, but I’m not sure where to start.

Can anyone share insights or strategies on how real estate investments can be used to reduce taxes on W2 income?

Specifically, I’m interested in understanding how deductions, depreciation, or any other tax strategies related to real estate might help.

Any advice or examples would be greatly appreciated!

[Bethany]

Talk to your CPA. Maybe look into cost segregation if you keep any of your projects.

Flips and STRs account for more of a business in IRS eyes.

[Scott]

It sounds like you qualify as actively managing your real estate. That means you can take loses below zero if that applies and that will reduce your w2 tax obligation.

It also means you can write off things like home office expenses and vehicle use

[Shawn]

A flip counts as a business, all business tax strategies apply. There is a lot you can write off through the rental as well.

[Tristan]

You write off your business expenses, but if you are flipping correctly I’d assume you made a profit and short term gain, so all you’d be doing is offsetting some of that gain

[Derik]

If your planning on buying another duplex, maybe worth looking into 1031 exchange?

[Author]

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