Year End Tax Planning for Real Estate Investors

Keeping Track of your receipts and cost throughout the year. Such as Auto and travel , cleaning and maintenance , advertising , management fees and commissions , professional fees, insurance and repairs.
Use the Section 179 Expensing- Section 179 allows taxpayers to deduct the cost of certain property as an expense when the property is placed in service. For tax years beginning after 2017, the TCJA increased the maximum Section 179 expense deduction from $500,000 to $1 million. The phase-out limit increased from $2 million to $2.5 million. These amounts are indexed for inflation for tax years beginning after 2018.
Calculate Depreciation-Use Bonus Depreciation -Businesses may take 100% bonus depreciation on qualified property both acquired and placed in service after Sept. 27, 2017, and before Jan. 1, 2023. Property that commonly qualifies for 100% bonus depreciation is: Appliances, Carpeting , Tools , Equipment , Computers , Software and Land Improvements.
Gifting assets or making donations to approved charitable organizations
Opportunity Zones- the Qualified Opportunity Zone still provides taxpayers the ability to defer the capital gains.
1031 Exchange
Avoid paying capital gains taxes on the sale of property
Interest paid on any loan or mortgage
Points, origination fees, credit reports, bank fees

Short-term rentals are those with an average rental period of less than 30 days. Long-term rentals are those with an average rental period of more than 30 days.
Short Term Rental increased flexibility and potential to increase rental income.
Long-term rental have a lower tenant turnover and consistent income.

3 IRS Safe Harbors Landlords Need to Know

The de minimis safe harbor is simply an administrative convenience that generally allows you to elect to deduct small-dollar expenditures for the acquisition or production of property that otherwise must be capitalized under the general rules. Landlords may use the De Minimis Safe Harbor to deduct up to $2,500 of the costs of tangible property used to produce or acquire rental real estate.

You are not required to capitalize as an improvement, and therefore may deduct, amounts that meet all of the following criteria:
Amounts paid for recurring activities that you expect to perform;
As a result of your use of the property in your trade or business;
To keep the property in its ordinarily efficient operating condition; and
You reasonably expect, at the time the property is placed in service, to perform the activities:
For building structures and building systems, more than once during the 10-year period beginning when placed in service, or
For property other than buildings, more than once during the class life of the unit of property.

You are not required to capitalize as an improvement, and therefore may be permitted to deduct, the costs of work performed on owned or leased buildings, e.g., repairs, maintenance, improvements or similar costs, that fall into the safe harbor election for small taxpayers. The requirements of the safe harbor election for small taxpayers are:
Average annual gross receipts of $10 million or less; and
Owns or leases building property with an unadjusted basis of less than $1 million or less; and
The total amount paid during the taxable year for repairs, maintenance, improvements, or similar activities performed on such building property doesn't exceed the lesser of-
Two percent of the unadjusted basis of the eligible building property; or
$10,000 (for questions about how to calculate the unadjusted basis, refer to "Figuring the Unadjusted Basis of Your Property" in Publication 946
The small taxpayer safe harbor must be claimed anew each year by filing an election with your timely filed tax return, which is due by October 15 each year