Before buying rental properties, I did try private lending and it was more passive for me without needing to get into the details of the investment and settle for a monthly return or net profit at the end of the project, which is the route I may return to.

Taking a loan via cash-out refinance can also free up cash for other investments while keeping the property generating passive income.Sell and Invest in Multifamily: If you sell, you’ll face capital gains tax, but you could use a 1031 exchange to defer the taxes if you reinvest in a similar property.

Their plan is to sell in 3-5-7 years and capture the gains so they can cash in.

You’re basically pulling future depreciation into this year.Two things to watch:Make sure the rentals are truly rental activities for passive vs nonpassive rules — big losses don’t help if you can’t use them.Get the study done by someone who actually knows residential rentals, not just big commercial.So: yes, you can do it now, yes, you can catch up, but no, you generally don’t get to go back and grab the old-year bonus as if you’d done the study in 2020.

All the stories here on BP are “my syndication stopped paying distributions” not “I’m making so much money totally passive!”

When you sell a property, keep in mind the capital gains tax, but if you hold the property for over a year, you’ll pay a lower tax rate on the profit (long-term capital gains).

It is the best way to get started with little money down, taking advantage of best market rates, and gaining experience landlord right in your backyard. 

That means more cash flow, faster pay-back, and smarter reinvestment.What Is Cost Segregation & Why STRs BenefitCost segregation is the process of breaking down a property’s purchase price (or renovation cost) and reallocating portions of it into shorter depreciation lives (typically 5, 7, 15 years) instead of being lumped into the standard residential/structure life (27.5 or 39 years).For STRs (especially where average guest stays are short and you materially participate) this becomes even more powerful:It accelerates write-offs and frees up cash sooner.It helps you convert your property into an “active business” rather than passive income in the eyes of the IRS, making more deductions usable against other income.Personally I'm a realtor which makes it easy to gain "material participation" as I am classified as a "real estate professional"There are ways to structure a property that is managed by someone else and still qualify.

We have a lot of completely passive investors.

This means a portion of the previously taken depreciation will be subject to taxation, effectively lowering your adjusted basis in the property and potentially increasing your taxable gain at the time of sale.