Tax Planning

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Real Estate Tax Planning in 2025: What Investors in LA Need to Know

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Smart Tax Strategies for Real Estate Investors

Real estate remains one of the most powerful paths to wealth, but it’s also one of the most complex when it comes to taxes. Whether you’re flipping, renting, or 1031 exchanging, having a strategic tax plan is essential. 

At Holmes & Associates, we work with real estate professionals throughout Los Angeles and Long Beach to ensure they’re maximizing their deductions and staying compliant. 

Key Considerations Before Year-End 

1. Bonus Depreciation is Changing 

2025 is one of your final chances to capitalize on elevated bonus depreciation. If you’ve placed assets in service this year, or plan to before year-end, you may be able to write off a substantial portion of those costs. 

Pro tip: Pairing bonus depreciation with a cost segregation study can significantly reduce your tax burden. 

2. Plan for Passive Activity Losses 

If your real estate activities are considered passive, your losses may be limited, unless you qualify as a real estate professional. Now is the time to assess your hours and documentation. 

3. Track Repairs vs. Improvements 

What you call a “repair” and what the IRS considers an “improvement” are two very different things. Misclassification is a common audit trigger and can drastically impact your deductions. 

Why Work With a Real Estate CPA in LA? 

Navigating tax law as a property investor in California comes with state-specific nuances, local property tax considerations, and multi-entity ownership strategies. Our team knows the landscape and can help you stay ahead. 

Ready to talk tax strategy? Call 562-495-3331 or book your free consult. 

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Mid-Year Tax Planning: Why Waiting Could Cost You

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It’s September — do you know where your tax strategy stands? 

If your tax plan is still on the back burner, now is the time to bring it front and center. At Holmes & Associates, CPAs, we specialize in proactive tax planning for business owners, real estate investors, and individuals throughout Long Beach and Los Angeles. The sooner we begin, the more opportunities we have to optimize your outcome. 

Why Mid-Year Matters 

By reviewing your tax position now — instead of in January or February — you can: 

  • Adjust estimated payments before Q4 

  • Identify missed deductions while there’s still time to correct them 

  • Plan major purchases or investments strategically for maximum tax benefit 

  • Avoid surprises when it’s time to file 

For Business Owners 

If you own an S-Corp, LLC, or Partnership, Q3 is ideal for re-evaluating your entity structure, retirement contributions, and owner compensation. With the pass-through deduction now permanent under the new tax law, there's even more incentive to ensure your setup is optimized. 

For Real Estate Investors 

Bonus depreciation is phasing out, but strategic moves before year-end can still lead to major savings. If you’re holding or managing property, now’s the time to: 

  • Run cost segregation studies 

  • Classify capital vs. repair expenses 

  • Project net income to reduce estimated tax stress 

Let’s Get Strategic 

Don’t settle for basic tax prep — go beyond the minimum. Holmes & Associates is a trusted Long Beach CPA firm with decades of experience helping clients reduce liability and grow smarter. 

📞 Call 562-495-3331 or schedule a consultation to build your 2025 strategy. 

 

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Is Your Estate Plan Missing a Financial Strategy?

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Estate planning isn’t just about drafting a will; it requires financial strategies to ensure assets are protected and efficiently transferred to heirs. Here’s what small business owners and investors need to consider: 

  1. Tax-Efficient Wealth Transfer 
    Without proper planning, estate taxes can take a significant portion of your assets. Setting up trusts and gifting strategies can reduce tax burdens. 

  1. Business Succession Planning 
    If you own a business, who will take over when you’re gone? A solid succession plan ensures a smooth transition and avoids legal disputes. 

  1. Keeping Beneficiary Designations Updated 
    Ensure life insurance policies, retirement accounts, and trusts have updated beneficiaries to avoid unintended asset distribution. 

  1. Avoiding Probate Delays 
    Probate can be costly and time-consuming. Placing assets in trusts and structuring ownership properly can streamline the transfer process. 

  1. Coordinating with Financial Professionals 
    Estate planning should involve collaboration between an attorney, an accountant, and a financial advisor to align legal and financial strategies effectively. 

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How to Reduce Taxes and Protect Your Business for the Future

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Small business owners often overpay on taxes due to a lack of proactive planning. Here are key strategies to reduce your tax liability while securing long-term financial success: 

Maximize Deductions and Credits 
Business expenses like home office costs, vehicle use, and employee benefits may qualify for deductions. An accountant can help identify savings opportunities. 

Structure Your Business for Tax Efficiency 
The right business entity (LLC, S Corp, C Corp) can significantly impact taxes. A CPA can help determine the best structure for your goals. 

Take Advantage of Retirement Plans 
Contributing to SEP IRAs, Solo 401(k)s, or other retirement plans reduces taxable income while building long-term wealth. 

Defer Income and Accelerate Expenses 
Delaying income recognition and prepaying deductible expenses before year-end can optimize your tax position. 

Use Estate and Succession Planning to Your Advantage 
Business succession planning strategies can reduce tax liabilities while ensuring smooth transitions. Additionally, trusts and family partnerships may offer valuable tax benefits.