19. How We Saved $1 million in Taxes Using Real Estate

In this episode of Paging Financial Freedom, Dr. Daniel Shin and Lila Kaplan break down some of the most important real estate tax strategies physicians and their spouses should understand. Drawing from their own investing experience, Daniel and Lila estimate that they have collectively saved more than $1 million in taxes over the past decade through real estate. They explain how depreciation works, what it takes to qualify for Real Estate Professional Status (REPS), and how certain short-term rental strategies can allow investors to use depreciation against active income. Daniel and Lila also share examples from their own portfolios, including tax refunds they received after putting these strategies to work.   The conversation also covers depreciation recapture and 1031 exchanges, including how investors can defer capital gains when moving from one investment property to another. Throughout the episode, Daniel and Lila emphasize the importance of understanding the rules, tracking your activity and working with a CPA who specializes in real estate.   Key Takeaways 00:45 – Why real estate and taxes go hand in hand 01:50 – How Daniel and Lila saved over $1 million in taxes 02:45 – Looking at the tax code as a playbook 04:02 – Four real estate tax strategies to understand 05:11 – How real estate depreciation works 07:31 – Real Estate Professional Status (REPS) explained 09:15 – How REPS can offset active income 11:44 – Lila’s experience using REPS 13:50 – How Daniel qualified for REPS as a physician 15:08 – The short-term rental tax strategy 17:27 – Reinvesting tax savings to compound wealth 18:16 – Depreciation recapture and 1031 exchanges 20:27 – The rules and deadlines behind a 1031 exchange 21:01 – Why working with a real estate CPA matters Disclaimer: Daniel and Lila share their personal experiences for educational purposes and are not providing individualized tax advice. Consult a qualified tax professional regarding your specific situation.  ˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍ Links from the Episode: 🔗 Apple Podcast 🔗 Spotify 🔗 Dr. Daniel Shin’s Real Estate Platform: Cereus Real Estate 🔗 Lila Kaplan’s Real Estate Investment Firm: Silverback Equity Partners ˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍˍ Stay Connected with Us: 👉 LinkedIn 👉 Instagram: Daniel Shin and Lila Kaplan 👉 YouTube:The Paging Financial Freedom Podcast