"Depreciating" Investment Property for Tax Purposes

by Dan
(Calgary)

Gentlemen,

Your website inspired me last fall to purchase my first investment property.

It's been a great investment, created splendid cash flow and I'm thrilled ... but now it's tax time.

I had planned on "depreciating" the investment property because I was told that was one of the many advantages of being a landlord.

But my accountant has informed me it's just a way of deferring taxes because the Feds will ding me on the backend when I eventually sell my property (maybe in 10 years).

I know you're not accountants, but what do you think?

Thanks,
Dan
Calgary

Comments for "Depreciating" Investment Property for Tax Purposes

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Mar 29, 2010
RE: Depreciating Your Canadian Real Estate Investments
by: Tom Karadza

Hi Dan!

Thanks for the feedback and congrats on taking action!

We usually depreciate our properties. Our believe is "cash in hand today is better than cash in hand tomorrow".

You're right though, we're not accountants, but generally our accountant recommends the same thing. There will likely be other tax strategies you can use to reduce taxes when you sell ten years from now.

We would take the advantage of depreciating the property but of course, to each their own!

Hope that helps,

Tom.

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