ilmscore | Prediction Details
"So now we know that the value of this building is $800,000. You take the $800,000, you divide it by 39, which is just over $20,000. Which means that now you get to take an additional $20,000 write-off just because now your building is one year older. This is what's called a paper deduction. You have $40,000 in your bank account, even though this property made you $50,000, then you had your other operating expenses, so now you made $40,000. You take this $20,000 depreciation deduction, which is only on paper, and then you tell the IRS, 'Hey, I only had $20,000 worth of taxable income.'"
By Minority Mindset | November 12, 2023 | Pending
From video
How The Wealthy Pay No Taxes (And How You Can Too) | Jaspreet Singh 00:01:07 - 00:01:37
Interpreted Prediction
A real estate investor can claim a depreciation deduction annually on the building's value (e.g., $20,000 on an $800,000 building over 39 years). This 'paper deduction' reduces taxable income even if cash flow is higher, resulting in a lower tax bill.

Prediction Details

Topic
Real Estate Depreciation for Tax Purposes

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