Buy and Hold Real Estate Investing: Tax Perks and Savings

If you’re considering a buy and hold real estate investing strategy, 2014 is definitely the year to try it out. A number of factors are aligning to make this year an excellent one for buy and hold real estate. Home prices are on the rise, but so are rents, and more people are looking to rent this year than have in decades. As an added bonus, there are a number of tax perks that go along with owning a rental property. Below are just a few of the ways that you can save on your taxes this year through buy and hold real estate investing.

1. Repairs

When you flip a house, you’re not able to deduct any of the expenses that go into remodeling the home on your taxes. This isn’t the case when you repair a rental property. Any time you make changes or updates to your property for the benefit of your tenants you can deduct your equipment costs, labor costs, and the cost of any new appliances.

2. Travel

If you have to do any travel that relates to your rental property, you can deduct your travel expenses from your taxes as well. Track your mileage going to and from your rental property so that you can deduct the cost each year. If you have a vehicle dedicated to your rental business, you can also deduct any expenses related to the vehicle. Likewise, if you travel overnight for any sort of rental activity, such as to scope out a new property or attend a conference, you can deduct your airfare, meals, and hotel bills.

3. Interest

Interest will be your largest deduction every year. As a landlord, you’ll be able to deduct mortgage interest payments on loans used to buy or improve the property as well as interest rates on credit card purchases related to your rental property.

Speak to your accountant to learn more about the many tax benefits that go along with buy and hold investing and find out just how lucrative this type of investment can be.  If you decide to move forward with this type of investment strategy and are in need of rental real estate financing, remember that ZINC is offering rates as low as 7.49% on our buy and hold loan programs.  To receive additional information, call our team today at (559) 326-2509.