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Understanding Depreciation Recapture in Real Estate: A Framework for Strategic Tax Planning

Published 5 months ago • 1 min read

Looking for a Cost Seg Study for your property?

Today’s topic: Depreciation recapture — and how to turn a “tax surprise” into a long-term wealth strategy.

Most investors hear “recapture” and think tax bomb. But with the right moves, it can actually become one of the most powerful tools in your playbook.

In this post, we break down:

  • What depreciation recapture is and how it works when you sell
  • A real-world example showing $120K in net tax savings
  • Why deferring taxes now beats paying them later
  • How inflation and the time value of money work in your favor
  • 4 smart strategies to reduce or eliminate recapture taxes — including 1031 exchanges, estate planning, and reinvestment cycles

“You might owe some tax later — but the cash you save and reinvest now can make you exponentially wealthier.”

Check out the full article to see how to make depreciation recapture work for you.

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We took a trip to Florida over the holidays to visit family and friends. Merry Christmas and Happy New Year!

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Cheers,

Sean

​Maven Cost Seg | Maven Success | Maven Equities​

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Hi, I'm Sean!

Sean Graham, CPA

Every week I share tips on real estate taxes, cost segregation, and navigating the entrepreneurship journey. Enter your email below to sign up for the Maven Newsletter!

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