AFTER TAX ANALYSIS OF INCOME PROPERTY
"After Tax Analysis of Income Property" is a 5 hour continuing education class. It covers cost recovery/depreciation; passive losses; capital gains taxes; and at risk limitations.
Cost recovery/depreciation: We discuss the history of cost recovery, and what the law currently says about it. We also discuss the effect that cost recovery, especially the recapture thereof, has upon yields in investment real estate. This is a subject which, if an investor is not cognizant of, can dramatically affect his yield in a negative manner.
Passive loss limitations: We again discuss the history of it, as well as what the current law is, who it applies to, and what the effects are on investment property yields. There are many eye opening discussions relative to this subject.
Capital gains taxes calculation: This has been a very hot topic lately, and brokers and principals need to know how to make this calculation. You don't have to be a CPA in order to understand how this calculation gets made. It does, however, take a good understanding of what the law says regarding it. The section on recapture and how it is taxed is always brand new information to about 75% of my students.
At risk limitations: This is a subject which is not too often encountered in today's world, but certainly can be a detriment, in some cases, to yields. It's important for the professional broker to be aware of these limitations.