Tax Breaks on Real Estate Investment

There are tax deductions and write offs of certain business expenses associated with real estate investment. Tax breaks are one of the major benefits of real estate investing.

Interest on mortgage payments is tax deductible

For example, the interest on your mortgage payments is tax deductible. This is one of the reasons why buying a real estate property is so attractive compared to renting a real estate property.

Other tax sheltering advantages

There are also a number of tax sheltering advantages for a real estate investor.  An example is 'depreciation'. Depreciation is a loss in value of business or income producing property over time. This helps the owners of rental real estate properties. 

Some other expenses can also be deducted from maintaining your business and managing your real estate properties. Examples are gas or car expenses for driving to and from your rental real estate properties, maintenance costs, cleaning costs, accounting costs, and administrative materials.