The Legal IRS Cheat Code Used by the 1%: ‘Borrow Until You Die.’

"I'm hosting a investor workshop live on January 13, 2026. It is going to be a very powerful one because a lot of things have changed in our economy in 2025. So, I decided in the beginning of 2026, we're going to start the new year right and I'm going to go over where our economy is shifting and how this creates new investment opportunities. So, if you're an investor and you want to see how you can get better returns in 2026. This is going to be a powerful workshop that you don't want to miss. It's completely free. It is going to be live on January 13th. I'm doing it twice. once in the morning at 10:30 a.m. Eastern time and then in the evening at 8:00 p.m. Eastern time."

"So, let's go back to this original example right here. You bought this quarter million property, rent it out for $2,500 a month, and after all your expenses, you're making $385 a month or $4,600 a year. Now, you make this $4,600 a year of income, which is nice, but you got to pay taxes on this money because remember we just talked about anytime you have income in the eyes of the IRS, you have to pay taxes. But real estate gives you this very interesting tax break called depreciation, which says that if your property is one year older, you qualify for a write off."

"Exception number one is if you make under $100,000 a year, you can write off up to $25,000 a year against your income, assuming that you are actively involved in this property."

"And if you make over 100 grand, that write off starts to phase off until $150,000."

"So now what you can do is instead of taking a $7,200 write off, maybe you can take a $20,000 write off in year one."

"So, let's run the numbers. You buy the same property, you treat it like an Airbnb, and now you made $10,000 over the course of a year. Now, you have a lot more turnover. You have more work, but you made this $10,000. You take the accelerated depreciation. Let us assume that you get $20,000 worth of accelerated depreciation. That's the write- off on paper, which means you made $10,000, you have it in the bank, but you could tell the IRS that you lost $10,000 on paper."

"But because of 1031, you can take all $500,000, buy another property, assuming you own the property for longer than a year and a day, start to generate more income, have bigger tax breaks, bigger depreciation because it's a bigger property, and you don't have to pay a penny in taxes on the gain because it's called a like kind exchange."