> For the complete documentation index, see [llms.txt](https://lofty-2.gitbook.io/faqs/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://lofty-2.gitbook.io/faqs/faq/do-i-benefit-from-depreciation.md). # Do I benefit from depreciation? Yes. Our accountants use the MACRS method for depreciation purposes and each property will be depreciated over 27.5 years. This means that even though you might be earning income from rents as well as appreciation (on paper, because the property value has gone up), the value of the property is actually reducing on paper for tax purposes. This can sound confusing and counter intuitive, but it is one of the main advantages of owning and investing in real estate in the U.S. If you’ve made $100 in income from rents, but the property on paper depreciated (for tax purposes only) by $1000 and you owned 10% of the holding entity, then you would actually benefit from a paper loss of $100, which would negate your rental earnings completely. As a result, even though you’ve physically received $100 for the year, you actually incur $0 in nominal income tax liability for that year through ownership in the property. --- # Agent Instructions This documentation is published with GitBook. GitBook is the documentation platform designed so that both humans and AI agents can read, navigate, and reason over technical content effectively. Learn more at gitbook.com. ## Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. Perform an HTTP GET request on the current page URL with the `ask` query parameter: ``` GET https://lofty-2.gitbook.io/faqs/faq/do-i-benefit-from-depreciation.md?ask= ``` The question should be specific, self-contained, and written in natural language. The response will contain a direct answer to the question and relevant excerpts and sources from the documentation. Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.