Our goal is to minimize your tax exposure.
- In year one and two, you can elect to get an allocation of depreciation, which many investors can use as a tax write off.
- We use cost segregation studies where possible to further accelerate how much depreciation we can allocate to you.
- Primarily in year three, if possible we’ll either start to sell or refinance assets. If we sell, you’ll get your initial capital back. The profit will usually be characterized as a long term capital gain. If we refinance, you get your initial capital back, which is a tax free event.
- If we are not able to sell assets in year three, in years four and five you will receive quarterly profit distributions from the operations of the assets. For most investors these will be taxed as ordinary income.
- In years four, five and six we’ll sell off assets that were not sold in year three. These profits will primarily be long term capital gains.