Portfolio Strategy Tax Question

[David Mazza]

Hey all, I have a very high level tax strategy question / hypothetical as a sole proprietor LLC. Let’s say I own a place worth $100k. After expenses, I net $15k in cash flow at the end of the year. I then take that $15k and buy another property, netting me back at $0 profit for the portfolio. Do I have to pay taxes on the $15k, or does it wash out due to the reinvestment back into another property? What if I earned the $15k through an investment in a syndication vs self managed property? Would that change anything? Thanks for the thought!

[Alina Trigub]

@David Mazza What's not clear from the information you provided is how long you own a place that's worth $100k? How old is the place? When did you purchase it? Is it still being depreciated? Have you taken a catch up depreciation (if eligible) against it? Bottom line, your actual income and your "paper" (tax return) income may differ. Consult with your CPA for further assistance.