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Listen "02. Breaking Down Depreciation in Syndications: Allocation, Recapture, and Bonus Timing"
Episode Synopsis
In this episode of the Major League Real Estate Podcast, hosts Nathan Sosa and Matt Hamilton take a technical dive into the mechanics of real estate depreciation and its role in tax strategy for syndications.
Together, they unpack:
- What depreciation is and why it matters in real estate investing
- The difference between depreciable basis and land allocation
- How depreciation schedules are determined (27.5 vs. 39 years)
- The significance of “placed in service” and capitalization thresholds
- How improvements, repairs, and settlement costs impact basis
- Cost segregation studies: methodology, compliance, and benefits
- The role of accelerated depreciation and bonus eligibility
- Depreciation recapture: ordinary income vs. capital gains treatment
- Why depreciation isn't a “tax loophole,” but a timing strategy
- Strategic use of amortization, loan cost recovery, and tax planning windows
Nathan and Matt also cover how the 2025 tax bill could impact bonus depreciation and what real estate investors need to know before year-end.
Request a free discovery meeting: go.therealestatecpa.com/mlre
Subscribe to the REI Daily Newsletter: go.therealestatecpa.com/mlresubscriber
Get the Ultimate Guide for Real Estate Syndications: go.therealestatecpa.com/mlreultimateguide
The Major League Real Estate podcast is for general information purposes only and is not intended to provide, and should not be relied on for, tax, legal, investing, financial, or accounting advice. Information on the podcast may not constitute the most up-to-date legal or other information. No reader, user, or listener of this podcast should act or refrain from acting on the basis of information on this podcast without first seeking legal and tax advice from counsel in the relevant jurisdiction. Only your individual attorney and tax advisor can provide assurances that the information contained herein – and your interpretation of it – is applicable or appropriate to your particular situation. Use of, and access to, this podcast or any of the links or resources contained or mentioned within the podcast show and show notes do not create a relationship between the reader, user, or listener and podcast hosts, contributors, or guests.
Together, they unpack:
- What depreciation is and why it matters in real estate investing
- The difference between depreciable basis and land allocation
- How depreciation schedules are determined (27.5 vs. 39 years)
- The significance of “placed in service” and capitalization thresholds
- How improvements, repairs, and settlement costs impact basis
- Cost segregation studies: methodology, compliance, and benefits
- The role of accelerated depreciation and bonus eligibility
- Depreciation recapture: ordinary income vs. capital gains treatment
- Why depreciation isn't a “tax loophole,” but a timing strategy
- Strategic use of amortization, loan cost recovery, and tax planning windows
Nathan and Matt also cover how the 2025 tax bill could impact bonus depreciation and what real estate investors need to know before year-end.
Request a free discovery meeting: go.therealestatecpa.com/mlre
Subscribe to the REI Daily Newsletter: go.therealestatecpa.com/mlresubscriber
Get the Ultimate Guide for Real Estate Syndications: go.therealestatecpa.com/mlreultimateguide
The Major League Real Estate podcast is for general information purposes only and is not intended to provide, and should not be relied on for, tax, legal, investing, financial, or accounting advice. Information on the podcast may not constitute the most up-to-date legal or other information. No reader, user, or listener of this podcast should act or refrain from acting on the basis of information on this podcast without first seeking legal and tax advice from counsel in the relevant jurisdiction. Only your individual attorney and tax advisor can provide assurances that the information contained herein – and your interpretation of it – is applicable or appropriate to your particular situation. Use of, and access to, this podcast or any of the links or resources contained or mentioned within the podcast show and show notes do not create a relationship between the reader, user, or listener and podcast hosts, contributors, or guests.
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