Deduct about a third of your rental this year, not over 27.5 years.

Usually, yes, once the depreciable basis (price minus land, plus improvements) is above about $150,000 and you can use the losses this year or soon. A $300,000 house with $60,000 of land often produces $60,000–$90,000 of extra first-year depreciation.

It's often not worth it if you plan to sell within a year or two, if land is most of the value, or if you're in a low bracket with no way to use the losses. The calculator shows the trade-off, and we'll tell you if the fee doesn't pay for itself.

Not automatically. Rental losses are passive by default, so they offset passive income first and carry forward if unused. There are three ways to use them against wages.

First, the short-term rental route: if the average guest stay is 7 days or less and you materially participate (commonly 100+ hours and more than anyone else, cleaners included), the activity is not treated as passive.

Second, real estate professional status: more than 750 hours a year and more than half your working time in real estate, plus material participation in the rentals.

Third, the $25,000 allowance for active landlords, which phases out between $100,000 and $150,000 of modified adjusted gross income. Your CPA decides which applies to you.

No. A look-back study works on any rental placed in service after 1986. Your CPA files Form 3115 (an automatic change in accounting method) and takes all the missed depreciation as a single catch-up deduction in the current year. No amended returns.

The shorter-life parts use the bonus rate from the year the rental was first placed in service. A 2022 rental still gets 100%, a 2023 rental 80%.

Some of it. On a taxable sale, depreciation on the 5-year parts is recaptured as ordinary income, and depreciation on the building and site work is taxed at up to 25%. Recapture only applies to gain; if you sell at a loss there is nothing to recapture.

Even so, a deduction today at 32–37% that's repaid years later is usually worth more than the same deduction spread over 27.5 years. You can also defer with a 1031 exchange, and heirs receive a stepped-up basis that wipes out recapture. If you expect to sell within two years, a study may not pay off. Ask us and we'll model it.

A study doesn't trigger audits by itself. What draws scrutiny is a poor study: rule-of-thumb percentages, no documentation, contingency fees, or an unrealistically low land value. Ours document every asset, its cost basis and the rule that puts it on a shorter schedule.

If the IRS asks about your study, we answer in writing about our method and classifications at no charge. We don't represent you before the IRS. That's your CPA's or attorney's role.