tax shelter

Definition

An investment strategy using real estate's depreciation deductions and other tax benefits to reduce taxable income. It's completely legal alchemy that turns rental properties into write-offs.

Example Usage

The real estate attorney explained how the commercial building would serve as a tax shelter, offsetting income through accelerated depreciation.

Origin

Tax planning term that became prominent with real estate during 1960s-70s tax code provisions

Fun Fact

The Tax Reform Act of 1986 severely limited real estate tax shelters, ending an era where doctors and dentists bought apartments purely for losses.

Source: Tax planning and real estate investment terminology

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joint tenancy

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WAC

Walk-Away Cash—the net proceeds a seller receives after paying off mortgages, liens, commissions, and closing costs. It's the moment of truth when sellers discover whether they're taking home a check or writing one.

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Property Tax

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exclusive right to sell

A listing agreement guaranteeing the agent gets paid commission regardless of who finds the buyer—even if it's you. It's the real estate equivalent of a no-compete clause, except you're competing against yourself.

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Bidding War

An auction-style feeding frenzy where buyers throw increasingly insane amounts of money at a house until only one financially reckless person remains standing. The winner gets the house. Everyone else gets therapy.

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Comparable

A nearby property that supposedly proves your house is worth what someone says it is, despite having completely different everything. It's the real estate version of comparing apples to slightly different apples that sold six months ago.

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