The wide variety of real estate tax opportunities available can be overwhelming. To make sure you’ve considered all potential sources of benefit, review our expansive checklist.  

​​☐​   Accelerated Depreciation  

• • Look-back studies via 3115, best results achieved for properties in service under 15 years  
  • Recall depreciation potential inherent in 754 Step Ups and 1031 Exchanges, as well as tax-exempt property 

​​☐​  Bonus Depreciation  

• • 100% for properties placed-in-service between 9/28/17-12/31/2022 
  • Acquired assets eligible under the TCJA 

​​☐​  Bonus-Eligible QIP (Qualified Improvement Property) 

• • QIP placed-in-service on or after 1/1/2018 is 15-year property and bonus-eligible – major implications for renovations/retrofits  

​​☐​ Expensing Options under the Tangible Property Regulations (TPRs)  

• • DeMinimus Safe Harbor (Itemized invoices will be helpful) 
  • Small Taxpayer Safe Harbor  
  • Routine Maintenance Safe Harbor (via 3115) 

​​☐​  BAR and Materiality Testing (for Expensing Decisions under the TPRs)  

​​☐​  Partial Asset Disposition (PAD Election) 

• • Must be elected in the year the asset was removed from service   
  • Subject to 280B Demolition Rules  

​​☐​  Section 179 Expensing Election  

• • Overall Expensing Dollar Limitation for TY 2022: $1.08M 
  • Phase Out Threshold for TY 2022: $2.7M 
  • Must be taken the year the work is placed-in-service  

​​☐​ 1031 Exchange  

• • Possibility of associated 15% Safe Harbor  

​​☐​ EPAct 179D Deduction 

• • Legacy program still in effect [Inflation Reduction Act (IRA) provisions not in play until TY 2023] 
  • Maximum deduction of $1.88/SF, partial deductions permitted 
  • For properties placed-in-service between 2015-2026, ASHRAE Reference Standard is 90.1-2007 
  • May be claimed retroactively (3115) 

​​☐​ Section 45L Credit  

• • Legacy program still in effect [IRA Provisions not in play until TY 2023] 
  • $2,000 credit per dwelling unit  
  • Claiming the credit results in a mandatory basis deduction and corresponding decrease in subsequent LIHTC Credit  
    

​​☐​ ITC (Solar Investment Tax Credit) 

• • Rate determined by when “construction commenced” – 26% in 2021, 30% in 2022 

​​☐​ LIHTC (Low-Income Housing Tax Credit) 

• • 4% credit (30% subsidy) for acquisitions, rehabs 
  • 9% credit (70% subsidy) generally for new construction and major rehabs without additional federal subsidies 

​​☐​ HTC (Historic Tax Credit)  

• • Rehabilitation of historic buildings — 20% of qualified rehab costs may be deducted  

​​☐​ State-Specific Incentives