An installment sale can spread eligible gain from rental or investment property over several years, but depreciation recapture, seller financing interest, mortgages, passive losses, related party rules, and California withholding can change the expected tax result. Learn what real estate investors should calculate before agreeing to seller financing.

A Delaware Statutory Trust can provide a passive replacement property option for a 1031 exchange, but qualification depends on the federal tax structure. Learn why Revenue Ruling 2004-86 matters, how DST debt and basis affect the exchange, what restrictions apply to the trustee, and which tax issues investors should review before investing.

Real estate partnership taxation extends far beyond entering a Schedule K1. Learn how outside basis, partnership debt, passive activity rules, property contributions, distributions, Section 704(c), Section 754 elections, and sales of partnership interests affect an investor's return.

Grouping rental activities can make material participation easier to establish, but it can also delay the release of suspended passive losses when one property is sold. Learn the difference between general activity grouping and the real estate professional election to combine rental real estate interests.

Short term rental losses are not automatically nonpassive. Learn how the 7 day and 30 day rules interact with material participation, when real estate professional status is unnecessary, when Schedule C and self employment tax may apply, and how cost segregation can affect the tax result.

A prior Section 1231 loss can change the tax treatment of a property gain years later. Learn how the five year lookback rule works, how intervening gains reduce prior loss balances, how K1 amounts and passive losses affect the calculation, and when current Section 1231 gain becomes ordinary income.

A Section 1031 exchange can defer gain on qualifying investment or business real estate, but the transaction must satisfy strict federal rules. Learn how the 45 day identification deadline, 180 day exchange period, qualified intermediary rules, boot, debt replacement, basis, related parties, vacation property, reverse exchanges, and depreciation interact.

Cost segregation can substantially accelerate depreciation on rental property, especially under the current federal 100 percent bonus depreciation rules. Learn how the strategy works, which assets can qualify, how passive activity rules can limit the deduction, what happens when the property is sold, and why California investors need a separate depreciation analysis.

A loss on rental or business property can receive favorable ordinary loss treatment under Section 1231, but that does not always mean the entire loss is immediately deductible. Learn how annual netting, passive activity rules, basis and at risk limits, excess business loss rules, depreciation recapture, and the five year lookback affect the final tax result.

Foreign sellers of California real estate can face both federal FIRPTA withholding and California Form 593 withholding at closing. Learn how the 15 percent FIRPTA rule works, when withholding can be reduced, how Form 8288 B is used, and how California gain based withholding, 1031 exchanges, and installment sales affect the transaction.

Selling depreciated rental property can create several different types of taxable gain. Learn how Sections 1245 and 1250 work, why rental property depreciation is not simply taxed at 25 percent, and how cost segregation, installment sales, Section 1031 exchanges, related party sales, and suspended passive losses can affect the final tax result.

Selling rental property or business real estate can trigger several different federal tax rules. Learn how Section 1231 gains and losses are calculated, how depreciation recapture and the five year lookback rule affect the result, and how installment sales, cost segregation, suspended passive losses, and Section 1031 exchanges fit into the analysis.

Real estate professional status can allow rental real estate losses to become nonpassive, but the rules require more than simply working 750 hours in real estate. Learn how the 750 hour and more than 50 percent tests work, how spouse hours and material participation are treated, when rental properties can be combined, and what the Tax Court decision in Mirch v. Commissioner teaches about documenting participation.

Rental income does not automatically threaten an S corporation election. The risk generally arises when the corporation has accumulated earnings and profits and more than 25 percent of gross receipts are passive investment income. Learn how the active rental exception, Section 1375 tax, three year termination rule, and E&P planning options work.

Section 1231 gain reported on a Schedule K1 is not automatically taxed as long term capital gain. Learn how partnership Box 10 and S corporation Box 9 flow through Form 4797, how prior Section 1231 losses can create ordinary income, and how passive activity, basis, at risk, and unrecaptured Section 1250 gain rules affect real estate investors.

Suspended passive rental losses can remain unused for years, but they generally do not expire. Learn four ways real estate investors may be able to use these losses, including passive income, the special rental allowance, former passive activity income, and a qualifying taxable disposition.

An S corporation can own rental real estate, but appreciating property can become expensive to remove. Learn how property distributions, leveraged contributions, LLC elections, liquidation, Section 1031 exchanges, self rental rules, estate planning, former C corporation status, and California taxes can affect the structure.

A 1031 exchange can defer gain from California real estate, but moving out of California does not necessarily eliminate California tax on that deferred gain. Learn how Form FTB 3840 works, how California tracks deferred gain through later exchanges, why California and federal basis can differ, and what proposed Regulation Section 17951-7 could change.

Moving out of California does not end California tax exposure on real estate you still own in the state. This guide explains California source gain, Form 593 withholding, former residences converted to rentals, installment sales, Section 1031 exchanges, and what nonresident sellers should review before escrow closes.