Many investors choose to control more of their money upfront by deferring their taxes. This delivers long-term benefits and enables capital to grow more rapidly, sooner.

Rental income – dividends, to investors – is not subject to certain kinds of taxes (such as Medicare and Social Security). This is significant when compared to earned income (though not necessarily when compared to other types of investment income).

Assets, including real estate, wear out over time. The IRS acknowledges this fact and allows MSL Capital to capture the “expense” of that wear as depreciation. Your taxable income is reduced as a result of this depreciation “expense.”

Depending on the type of property MSL Capital invests in, the amount of depreciation you can report will differ. For example, a multifamily unit has a shorter depreciation schedule (and therefore, a higher amount you can claim each year) than an office, industrial, or retail property. These depreciate over a longer timeframe, so lower tax benefits accrue to the investor.

Because MSL Capital invests primarily in multifamily, our investors realize greater depreciation benefits, quicker.

The sale of property is taxed at capital gains rates (which is lower than income taxes). This is a strategic advantage for high net worth investors who may be taxed on other income at a very high rate. When selling real estate that’s appreciated in value, the gain is taxed at the capital gains rate, and our investors save money because it is a lower rate. MSL Capital passes through the capital gains benefits to investors as if they own the property in their individual capacity.