The Tax Secrets Wealthy Real Estate Investors Use (And You Don’t)

In this episode, Craig McGrouther and I tackle two of the most frequently asked questions from investors: bonus depreciation and 1031 exchanges. With 100% bonus depreciation returning, they explain why this doesn"t automatically mean 1:1 depreciation for investors, breaking down how leverage, CapEx, and land allocation affect your actual depreciation ratio. Using our current deal as an example, we can show why conservative 65% leverage yields ~45% depreciation rather than the 90% you"d get at 80% leverage, but creates a much safer investment. We also demystify 1031 exchanges, clarifying the crucial difference between exchanging INTO a deal (minimum $1M via tenancy-in-common) versus exchanging OUT at the partnership level after exit. I emphasizes the "magic" of syndications: allowing everyday investors to compound wealth tax-free through partnership-level 1031 exchanges without needing millions upfront. Apply to attend the LSC Summit 2025: www.lscsummit.com Download our FREE Passive Investor Guide: https://www.lscre.com/content/passive-investor-guide Subscribe to our newsletter and get the FREE Underwriting Toolkit: https://www.lscre.com/resource/fof-underwriting-toolkit Learn more about Lone Star Capital: www.lscre.com Follow me on LinkedIn: https://www.linkedin.com/in/rob-beardsley Read my latest articles: https://www.lscre.com/blog