Interest Deductibility

March 27, 2018

New limits impact tax planning:

  • Deductions for interest limited to 30% of income before interest, taxes and depreciation
  • Real Estate companies can elect out by lengthening depreciation for assets


Ken Weissenberg:

Another thing they did was they limited the ability to deduct interest. For any kind of business, deduction for interest is limited to 30% of income before interest taxes and depreciation.

Real estate companies have the benefit they can elect out of that provision, but in order to do so, they have to lengthen the terms of depreciation for the real estate assets. That would be 40 years instead of 39 for commercial properties, 30 years instead of 27.5 for residential properties.

About Kenneth Weissenberg

Kenneth Weissenberg CPA, Tax Partner in Real Estate Services, is experienced in tax saving strategies and negotiating sales and acquisitions. He represents owners of some of the most well-known real estate properties in New York City.

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