Section 179 and Real Estate

3 Replies

As many have said in previous Section 179 posts, for real estate it is hard to generate enough tax liability to be able to take full advantage of what section 179 can provide. That being said, is a reasonable strategy to pair it with years where you sell a few rental properties with large amounts of capital gains? Anyone done something like this?

@Mark Abele

Section 179 is generally not compatible with rental properties. It certainly cannot be used to offset capital gains.

There is some debate whether we can use Section 179 for a larger portfolio of rentals that would qualify as a 
"trade or business." 

@Mark Abele Section 179 can now be very useful for small to midsize owners of non-residential buildings if they want to replace, say, the roof (thanks to the new tax law).  This is especially true if the building has been fully depreciated (no depreciation deduction) and/or the property is owned free and clear (no mortgage interest deduction).