--- title: The US Tax Code Favors Real Estate Investors description: Real estate investors face unique challenges under the US tax code from the sale of real estate. image: https://m.insigniafs.com/hubfs/Imported_Blog_Media/MiddleagedBizMan1.jpg --- [Skip to content](https://m.insigniafs.com/cre-finance-insights/real-estate-investors-tax#main-content) ![INSIGNIA 002B67 2023 (200X74 px) Trans](https://m.insigniafs.com/hs-fs/hubfs/INSIGNIA%20002B67%202023%20(200X74%20px)%20Trans.png?width=200&height=74&name=INSIGNIA%20002B67%202023%20(200X74%20px)%20Trans.png) Open main navigation Close main navigation - [Contact us](https://insigniafs.com/contact/) [Contact us](https://insigniafs.com/contact/) Nov 17, 2021 12:45:09 AM # The US Tax Code Favors Real Estate Investors [John Morelli](https://m.insigniafs.com/cre-finance-insights/author/john-morelli) Share: [facebook-f icon](http://www.facebook.com/share.php?u=https://m.insigniafs.com/cre-finance-insights/real-estate-investors-tax) [linkedin-in icon](http://www.linkedin.com/shareArticle?mini=true&url=https://m.insigniafs.com/cre-finance-insights/real-estate-investors-tax) [Twitter icon](https://twitter.com/intent/tweet?url=https://m.insigniafs.com/cre-finance-insights/real-estate-investors-tax) [envelope icon](mailto:?body=https://m.insigniafs.com/cre-finance-insights/real-estate-investors-tax) Yet, most investors don’t know how to take advantage of these tax benefits. A real estate investor focused, [virtual CFO](https://www.linkedin.com/in/irina-troychanskaya/) will help investors implement tax savings strategies to successfully to reduce or defer the resulting income tax from the sale of real estate. Real Estate Investors can face unique tax challenges from the sale of real estate. Whether you regard taxes as a necessary evil, or just plain evil, understanding the types of taxes that may apply to various types of income derived from real estate investment and real estate transactions, and how to manage your tax liabilities, will directly impact the profitability of your real estate investment business. Rental income, like other forms of income, is subject to taxation. The effective rate of taxation applicable to you will depend on many factors, not least of which is being aware of all the allowable deductions that you can claim to reduce your tax liabilities. For fix-and-flip investors, an important consideration is taxes that apply to real estate transactions, specifically when selling a property. A capital gain is an increase in the value of a capital asset, and that increase in value is realized when the asset is sold. Short-term capital gains are taxed at higher rates than long-term capital gains – an important consideration for investors who aim to hold a property for the shortest period possible before selling it for a profit. **Two Tax Tips for Real Estate Investors:** Tip #1 – Be organized and keep records. To be able to claim deductions, you need to keep records of your expenses related to the operation of your rental properties. Your tax accountant can give you advice on the types of expenses you need to track. Tip #2 – Consult a tax accountant! It doesn’t matter if you only own one property or several, a tax accountant can give you valuable information and advice on deductions, local and state-specific tax laws, and how to be tax compliant while keeping your tax liabilities as low as possible. Contact [Irina Troychanskaya](https://insigniafs.com/irina-troychanskaya/) for more information and helpful resources for optimizing your investments and investment results, in order to maximize your tax savings.   [CRE](https://m.insigniafs.com/cre-finance-insights/tag/cre), [COVID19](https://m.insigniafs.com/cre-finance-insights/tag/covid19), [capital gains](https://m.insigniafs.com/cre-finance-insights/tag/capital-gains), [bridge loans](https://m.insigniafs.com/cre-finance-insights/tag/bridge-loans), [cfo](https://m.insigniafs.com/cre-finance-insights/tag/cfo), [fix and flip](https://m.insigniafs.com/cre-finance-insights/tag/fix-and-flip) ## Related posts [commercial real estate](https://m.insigniafs.com/cre-finance-insights/tag/commercial-real-estate), [Educational Material](https://m.insigniafs.com/cre-finance-insights/tag/educational-material), [Educational](https://m.insigniafs.com/cre-finance-insights/tag/educational) ## [Commercial Real Estate Loan Sizing](https://m.insigniafs.com/cre-finance-insights/loan-sizing) [John Morelli](https://m.insigniafs.com/cre-finance-insights/author/john-morelli) Jul 5, 2024 10:52:16 PM What is Loan Sizing? Loan Sizing consists of a commercial lender evaluating the cash flow of the... [Read more](https://m.insigniafs.com/cre-finance-insights/loan-sizing) [![](https://m.insigniafs.com/hs-fs/hubfs/Imported_Blog_Media/Martin-Corner-Mixed-Use-Development.jpg?height=200&name=Martin-Corner-Mixed-Use-Development.jpg)](https://m.insigniafs.com/cre-finance-insights/how-can-you-get-started-in-commercial-real-estate) [Blog](https://m.insigniafs.com/cre-finance-insights/tag/blog), [commercial real estate](https://m.insigniafs.com/cre-finance-insights/tag/commercial-real-estate) ## [How to get started in Commercial Real Estate Investment](https://m.insigniafs.com/cre-finance-insights/how-can-you-get-started-in-commercial-real-estate) [John Morelli](https://m.insigniafs.com/cre-finance-insights/author/john-morelli) Oct 18, 2023 9:34:02 PM Getting started in commercial real estate can be a lucrative venture, but it’s important to... [Read more](https://m.insigniafs.com/cre-finance-insights/how-can-you-get-started-in-commercial-real-estate) [CRE](https://m.insigniafs.com/cre-finance-insights/tag/cre), [commercial real estate](https://m.insigniafs.com/cre-finance-insights/tag/commercial-real-estate), [Educational Material](https://m.insigniafs.com/cre-finance-insights/tag/educational-material), [Educational](https://m.insigniafs.com/cre-finance-insights/tag/educational) ## [Loan to Purchase (LTP)](https://m.insigniafs.com/cre-finance-insights/loan-to-purchase-ltp) [John Morelli](https://m.insigniafs.com/cre-finance-insights/author/john-morelli) Jul 6, 2024 4:22:19 PM How to Calculate Loan to Purchase (LTP) Loan to purchase (LTP) is a real estate underwriting metric... 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