Welcome to passive real estate investing, the show where busy people like you learn

how to build substantial passive income while creating wealth for the long term.

And now here's your host, Marco Santorelli.

Hello my friends and welcome to another. Now here's your host, Marco Santorelli.

Hello, my friends and welcome to another episode of Ask Marco.

Today's question is very quick and simple,

and so I'm going to give a quick simple answer.

And interestingly enough, this is not a question that comes up very often at all.

And the reason is because the question has to do with something that is 27.5 years down the road.

So John writes in with a question

and he says, I've been searching for the strategy

planning for approaching end of depreciation life of rental property.

27.5 years was always so far out there

I didn't expect to still have the property.

As you get into the 20s, meaning 20 years and on of ownership, not

your age of 20s, should you start looking to exchange the property, or just disregard and only look at the income potential

though there will be similar units but at higher and depreciable cost basis.

So good good question. The answer to the question is really two parts. Really, it depends. If you've held a property for 27 and a half years, which by the way for listeners that are not aware,

the IRS allows you to depreciate the improvements of your property, which means everything

but the dirt, over a 27 and a half year period and this depreciation is essentially a phantom write-off.

It means you can deduct it from your taxes, your income, your passive income, each and every year and it lowers the taxable income from your

property. Now although it's not actually lowering the income in dollar terms it just

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