How depreciation can lower your taxes When you buy a rental property, you can deduct most of the expenses you incur keeping it up, thus lowering your taxable income. In the eyes of the IRS, most ...

The depreciation recapture tax is the difference between a rental property’s sale value and its depreciated value. This is extra income that will be taxed on your next tax return, after selling ...

Accelerated depreciation allows for more depreciation to be deducted in the earlier years of property ownership, whereas straight-line depreciation deducts the same amount every year.

Understanding Depreciation Depreciation reflects the gradual decrease in value of a rental property due to aging, wear and tear, or obsolescence. For tax purposes, the IRS allows property owners ...