The Home Office Deduction is a tax deduction for expenses related to a portion of a home used exclusively for business purposes. Related Terms
Glossary Terms: 52 terms
Installment Sales is a method of deferring taxes on the sale of property by spreading payments and taxable gains over multiple years. Related Terms
Installment Sales
The Internal Rate of Return (IRR) is a metric used to evaluate the profitability of an investment by calculating the rate at which net cash flows equal the initial investment. Related Terms
Internal Rate of Return (IRR)
The Like-Kind Exchange is a tax-deferral strategy under IRC Section 1031 that allows real estate investors to defer capital gains taxes by exchanging one investment property for another of similar or greater value. Related Terms
Like-Kind Exchange
Mortgage Interest Deduction is a tax deduction for interest paid on loans used to purchase, build, or improve real estate. Related Terms
Mortgage Interest Deduction
The Net Operating Income (NOI) measures a property’s profitability. It is calculated by subtracting operating expenses from rental income, excluding financing costs. Related Terms
Net Operating Income (NOI)
Nonpassive (Active) Income is earnings from wages, salaries, commissions, and business activities where the taxpayer materially participates. This contrasts with passive or portfolio income. Related Terms
Nonpassive (Active) Income
Nonrecourse Debt is a loan where the lender’s recovery is limited to the collateral property and the borrower has no personal liability. Related Terms
Nonrecourse Debt
Opportunity Zones are economically distressed areas designated by the government where investors can receive tax benefits for reinvesting capital gains into long-term projects. Related Terms
Opportunity Zones
Passive Activity Loss Rules are regulations that restrict investors from using losses generated by passive activities, like rental properties, to offset income earned from active sources. Related Terms
Passive Activity Loss Rules
Passive Income is income earned with minimal active involvement and no material participation, such as rental income or earnings from partnerships and REITs. Related Terms
Passive Income
Personal Residence Exemption is a tax exclusion under IRC Section 121 on gains from the sale of a primary residence, up to $250,000 for single filers and $500,000 for joint filers. Related Terms
Personal Residence Exemption
Property Tax Assessment is the process by which local governments determine the value of a property for taxation purposes. Related Terms
Property Tax Assessment
The Property Tax Deduction is a tax deduction for property taxes paid to state and local governments on real estate owned. Related Terms
Property Tax Deduction
Qualified Business Income (QBI) is a deduction of up to 20% of qualified business income for eligible taxpayers under the Tax Cuts and Jobs Act (TCJA). Related Terms
Qualified Business Income (QBI)
Qualified Improvement Property (QIP) refers to non-structural interior improvements to commercial property that is eligible for accelerated depreciation or bonus depreciation. Related Terms
Qualified Improvement Property (QIP)
A Qualified Opportunity Fund (QOF) is an investment vehicle created to invest in Opportunity Zone properties and businesses, providing tax incentives to investors. Related Terms
Qualified Opportunity Fund (QOF)
A Real Estate Investment Trust (REIT) is a company that owns, operates, or finances income-producing real estate. REITs offer investors a way to invest in real estate without owning physical property. Related Terms
Real Estate Investment Trust (REIT)
Real Estate Professional Status (REPS) is a tax designation allowing qualifying individuals to treat rental property losses as nonpassive, enabling greater offsets against income. Related Terms
Real Estate Professional Status (REPS)
Real Estate Tax Deductions are tax deductions available to real estate investors, including mortgage interest, property taxes, insurance, repairs, maintenance, etc.. Related Terms
