How Real Estate Can Lower Your Tax Bill as a W-2 Filer

In this episode of How to Lower Your Tax Bill, host Terrence Hutchins dives into tax strategies tailored for W-2 filers who are real estate investors. As a financial and tax advisor in the Dallas-Fort Worth area, Terrence shares actionable tips to help you leverage real estate to grow your wealth while reducing your tax burden.

What You’ll Learn:

• The BRRRR Strategy: How the "Buy, Rehab, Rent, Refinance, Repeat" method accelerates real estate portfolio growth and provides tax advantages.
• Return on Equity: Why targeting a 5% return on equity is key to achieving financial independence through real estate.
• Short-Term Rentals: How IRS rules on rentals averaging fewer than seven days can allow you to offset W-2 income with real estate losses.
• Cost Segregation Studies: Breaking down your property into depreciable components to maximize tax deductions, including accelerated depreciation benefits available in 2025.
• Financing Strategies: Creative ways to fund your real estate investments, including leveraging life insurance policies and stock portfolios tax-efficiently.

Featured Tax Story: Terrence highlights a 2004 tax court case, Robert P. Sweet vs. Commissioner, where the IRS incorrectly classified a rental property. The couple’s victory underscores the importance of proper record-keeping, understanding the tax code, and working with knowledgeable professionals to protect your earnings.

For more actionable tax tips, subscribe to How to Lower Your Tax Bill on Spotify or Apple Podcasts. Remember: it’s not just about lowering your taxes—it’s about keeping more of what you earn!