Real Estate Tax Strategy:Cost Segregation,Bonus Depreciation, & Building Your Brand

Yonah Weiss (00:00)
Now I’m seeing reports that are upwards of 90%. So it’s crazy. Like you buy a million dollar robbery and you can take in the first year a $900,000 tax deduction. It’s just, it’s mind blowing because it

Dylan Silver (00:10)
It’s mind blowing.

Yonah Weiss (00:11)
like it’s it’s if it’s financed like you can literally paying zero out of pocket or 20 % down or whatever that is and be taking this huge tax write off.

Dylan Silver (01:53)
Hey folks, welcome back to the show. Today’s guest, Yonah Weiss is the business director at Madison Specs, a national cost segregation firm. He’s been featured on hundreds of podcasts and has his own show as well, Weiss Advice. He’s a real estate investor and has a background as an educator. Welcome to the show, Yonah.

Yonah Weiss (02:10)
Thanks so much Dylan, great to be here.

Dylan Silver (02:12)
Great to have you on. Now, when we talk about finding your niche in the real estate space, and we were talking in the green room about some of the segments of real estate that you’re active in, when folks are starting out, there’s oftentimes analysis paralysis, they’re trying to figure out which segment of real estate to jump into. Any feedback for those folks?

Yonah Weiss (02:35)
It’s very difficult. I would say that. But don’t get overwhelmed. would say just do something start as a mentor of mine used to say, right, version one is better than version none. OK, so you can you can always start and you can change and you can change up things. But if you are focused on one thing and pick one lane, pick one focus first. OK, for me, it was easy because, you know, doing cost segregation is extremely niche. Now it’s much more

prevalent than it was when I started eight years ago, it was nine years ago now already. But it’s something that is very unique sector to the real estate world. And so it was very easy to then kind of show up on social media, especially as this expert in a specific field and specific niche. But it’s about being consistent with that. Even if you do change at a certain point, your personality and you, you’re not going to change. So

making your personal brand part of you, part of who you are in sharing whatever it is that you’re sharing out there, that that will stay consistent even if you pivot, which obviously every great business person pivots when necessary.

Dylan Silver (03:47)
Now, I know a little bit about cost segregation because I’ve had a couple of folks in this space on the show here. From what I understand, this is something that is more applicable now than ever because of 100 % bonus depreciation. Can you help break this down for us in layman terms?

Yonah Weiss (04:50)
Very simple. Cost segregation is an advanced form of depreciation. So you’re absolutely right with the 100 % bonus depreciation. And I’ll explain what that is. Now is better than ever to use cost seg. So basically when you buy a property besides for your primary residency, any rental property or business property, if it’s residential commercial, it doesn’t matter. You can claim a deduction called depreciation. Now it’s a borrowed term. It doesn’t actually mean your property is going down in value.

It just means that because you bought this property, now you can literally write off the value of that property, but you have to do it over a long period of time. those depreciation deductions are spread out over a 27 and a half year period for residential properties, over a 39 year period for commercial properties. And it’s very arbitrary numbers. But what cost seg does is is allows through an engineering study of a property show

that certain components actually depreciate on a five or seven or 15 year schedule, which means we can take bigger deductions during the earlier years of ownership. essentially it’s a cash flow mechanism showing that I may not be able to take this right off this income tax right off ⁓ entirely because I may not even hold the property for that long. Who knows I’m going to live for 39 years. But what is what is still available are those potential deductions. So if we can find a way to front load

a certain portion of those deductions, basically take them now, that’s what really costs I guess. So 100 % bonus depreciation is a law that passed back in the Tax Cuts and Jobs Act back in 2017 and then was reinstated. It phased out and then was reinstated with the one big, beautiful bill last year. And what that says is once you’ve done a cost segregation study and shown how different components depreciate over different or faster timelines, you can now take those faster depreciation deductions

in the first year as a tax write off. So think about it like this. Let’s say you buy a million dollar property. OK, we can’t depreciate land. So you always have to subtract a certain amount for land. Let’s say it’s 10 percent or 15 percent. Let’s keep it simple. OK, so eight hundred and fifty thousand dollars is our remaining basis. That’s what we can now take as a tax write off. So you spread that over over twenty seven years. It’s thirty thousand dollars basically. OK, give or take. So what depreciation says is you bought a property.

Guess what? Million dollar property, can already now just take a $30,000 tax deduction right off the bat. So that lowers your taxable income. What CostSec does and says, hey, hold up, 20 % of those, or maybe 30 % of those deductions can actually be taken in the first few years. So now I can, oh wow, over a five year period, depreciate 20 % of the property as opposed to just 2 % every single year. What that does is gives you doubles or triples that $30,000.

into 60 or $80,000 for the first five years. What bonus depreciation comes in and says, guess what? You can take that as a lump sum in the first year. So now instead of taking a $30,000 deduction every year for the next 27 years, we say you can front load 20 % of that. OK, so we’re to take $200,000 as a deduction in the first year. And I’m just rounding the numbers. And then every subsequent year, you’ll still have the normal straight line 27 and 1.5 year depreciation.

But so you’re going to subtract them by 20%. So instead of the $30,000, you have a $24,000 deduction every year for the night for after the first year. So basically what we’re doing is saying you bought this million dollar property. Now, first year, you can take a $200,000 tax deduction. And again, these numbers are very round. They can be much, much more. They can be less. But you get the point.

Dylan Silver (08:22)
Now, when we talk about the utility for cost seg, is there one segment that may be more applicable than others or can you use this, you know, maybe equally across the board from single family to multifamily to industrial and, you know, even self storage RV parks?

Yonah Weiss (08:39)
Yeah, you can use this, like I said, for any type of property whatsoever. However, there are certain types of properties that are more beneficial. For example, RV parks or mobile home parks where there’s really very little structure involved. And so when we talk about structure, that’s the twenty seven and a half year depreciation. But anything that is faster than that, like the 15 year, which is land improvements ⁓ or five year property, which is personal property, essentially all you’re buying when you’re buying a mobile home park or an RV park.

is the land and the land improvements. So land doesn’t depreciate. We subtract that. But what’s left is the concrete, the pavement, right? Asphalt, landscaping, fencing. Septic would actually be considered infrastructure, although now with a new, ⁓ and so it could be on the 27 and 1 year schedule. However, now there’s been a new ⁓ ruling that allows for infrastructure, things like septic and electric and plumbing, things like that, to actually be considered part of the five year.

Dylan Silver (09:16)
except it.

Okay.

Yonah Weiss (09:37)
or 15 year property for mobile home parks, is totally mind blowing. Yeah, because it used to be, you know, between 50 to 80 % of your tax basis, we could take as bonus depreciation because, you know, a huge amount of that, as opposed to the 20 to 30 % in the multifamily sector.

Dylan Silver (09:42)
Cute.

Yonah Weiss (10:29)
Now I’m seeing reports that are upwards of 90%. So it’s crazy. Like you buy a million dollar robbery and you can take in the first year a $900,000 tax deduction. It’s just, it’s mind blowing because it

Dylan Silver (10:40)
It’s mind blowing.

Yonah Weiss (10:41)
like it’s it’s if it’s financed like you can literally paying zero out of pocket or 20 % down or whatever that is and be taking this huge tax write off.

So that’s one of the reasons why cost seg is such a huge tax strategy because you can basically use this to scale pay zero tax still be making money and use whatever money you’re making to reinvest without having that huge income tax burden that everyone’s usually burdened with.

Dylan Silver (11:08)
Pivoting a bit here, Jonah, you know, when we talk about building a brand in real estate, one of the tricky things that I’ve noticed people stumble across really is identifying exactly what their messaging is going to be, or maybe they’re slow to start, or maybe it’s thinking, what kind of content am I gonna put out there? You’ve done so many podcasts, you’ve got such a strong brand. How has that developed over the years for you?

Yonah Weiss (11:10)
Sure, yeah.

Well, that’s, you know, it developed and that’s really the point. You have to start. So I remember the first time I was ever on a podcast, I was like, what is a podcast? You know, I was invited to go on a podcast and I had no idea what I was really getting into and realized that it was such a great conversation. The next week I got invited on another one. And then it snowballed from there up to this point where we’ve done over 500 episodes as a guest, as well as my own podcast, which were closing close to 500 episodes.

as well on that as an interviewer. it takes time. That’s really effort plus time, or multiplied by time, is really where you’re going to hone in to those skills. Because it does take time. And posting online, people get caught up. How am going to do it? What am I supposed to talk about? No one’s watching it. Like one like and one click, whatever.

It doesn’t matter. Just start it because it’s you’re going to get it better at it time over time. If you’re focusing on it and you’re trying to figure out what that niche is, you’re going to get better over time. So just start ⁓ the branding. Like I said, for me, the niche was was very easy to pick the constriction expert.

And then people get to know you and they align what it is that you do with who you are and your face and your name. And so that’s what branding is. And it becomes, I see your face. I see your name. I know exactly what you do. And that’s what you want to drive home. So it’s not as much about ⁓ what you’re saying, right? But it’s about making sure the branding is on point so that people, when they see your name or your face, they’re going to remember it is what that you do.

Dylan Silver (13:11)
There’s a little bit of an element too that I’ve noticed where people can almost diversify their online presence. So they might be posting on certain platforms, they might have a podcast, right? they, like your website is really remarkable. I think it really well ⁓ explains who you are and everything that you’re involved in. And I think that for searchability and discoverability, and when people are trying to rank higher in search, it’s somewhat shocking how just…

Having one podcast up diversifies things a little bit and people can appear higher in search, at least for now in March of 2026.

Yonah Weiss (13:46)
Right. Yeah, I mean, that’s that’s true. But I think really what the most important part of the branding is getting seen, right, and getting creating those relationships, because essentially, and I can say this with utmost confidence, the

Dylan Silver (13:47)
You

Yonah Weiss (14:02)
the number one driver for my business, ⁓ which we just through online presence, it’s been years now, but well over eight figures in business is through relationships, is through those connections, is through introductions and ⁓ referrals. And because you’re known, people are going to share that with the people that they know. And having an online presence is huge. But don’t get

too caught up in the quote unquote persona of it, get more focused on the relationships that you create through that, because that’s really what it comes down to. That’s really what business is, right? Business is about those relationships.

Dylan Silver (15:23)
You know, and especially this is my perspective as a realtor in Texas, you know, you can focus so much on understanding the X’s and O’s of one specific real estate strategy or being a great deal underwriter. But ultimately, I think most people, you know, can relate to this on some level. It really is about those relationships, right? Like you could have everything lined up, but if you don’t have the lender who can close on that deal, or if you don’t have the end buyer, you know, in hand,

if you’re you’re wholesaling, for instance, or you know, if you don’t have the right team in place to manage, you know, timeline in a flip, right? You can have all the right intentions and all the right plan. But then, you know, it doesn’t come to fruition simply because of those relationships. Those relationships for me for my money’s worth are the most important thing in real estate bar none.

Yonah Weiss (15:55)
Mm-hmm.

For sure. you know, to quote someone that I don’t necessarily align with 100 percent, but just the concept struck out to me is is Grant Cardone. He said that in one of his books I read years ago, said the difference between ⁓ contact and contract is the R, which is relationship. Right. You can have a lot of contacts and people out there. Right. But you want to make a deal, you want to make money. It’s it’s creating that relationship.

Dylan Silver (16:38)
You mentioned contact. I had an early mentor of mine tell me real estate is a contact sport. ⁓ especially cutting my teeth in the real estate wholesale space, it really is. I mean, you’re walking into distressed properties. You’re walking in situations where these are very cold leads. People don’t necessarily know or expect you to be coming with a solution. And there’s a lot of distress. And in many ways,

Yonah Weiss (16:44)
Hahaha

Right.

Dylan Silver (17:08)
that contrast with my perspective as a realtor, because realtors in most cases don’t want to deal with distressed property. And many realtors just say, hey, I’ll leave those investors over here and let me go find the people that actually have the money to close on homes versus working with people who may be losing their home, right? And so this idea that you can just facilitate your business purely online, I also think that that for most people is not gonna ring true when you do have to have these

Yonah Weiss (17:26)
Hmm.

Dylan Silver (17:37)
you know, hand to hand, eye to eye conversations.

Yonah Weiss (17:40)
For sure. It’s great to have that online presence and persona. And I do it. I work across the country. We’re the biggest national ⁓ company. And I invest across multiple states. But in the end of the day, going out to those places and having those, whether it be at conferences, whether it be in meetups, whether it be in one-on-one, and in your case, as a realtor, meeting with buyers or potential investors, things like that, that’s.

That’s critical. You need that. It doesn’t matter, like you said, how much online presence you have. If you’re not showing off, you’re missing out.

Dylan Silver (18:16)
We are coming up on time here, Yonah. Any new projects that you’re working on and then as well, what’s the best way for folks to get in contact with you or your team?

Yonah Weiss (18:24)
One project actually which we’ve been working on recently, which is very similar to what we’ve been talking about now is I used to have an online Zoom weekly meetup called the Real Estate Connections, right, meetup. that was awesome during COVID and during the time when everyone was in lockdown. It fizzled out a little bit, but over the last year, we’ve transitioned to doing that in person. So we’ve actually gone to nine different cities.

around the country over the last year and continuing that over the spring and summer of 2026. And so I’m looking forward to having other having just small kind of intimate meetups, usually about 20 to 60 people at these things. And they’re just great ways to network with like-minded professionals. Most of the people that I meet up there are our clients of mine, but

⁓ real estate investors, but the truth of matter is, really a lot of people come out and it’s a lot of fun. So that’s something that a new project that we’ve been working on that I really love. And yeah, if you want to reach out to me, find me online. I’m pretty much active on most of the social platforms, but do not just hit that follow button. Take 10 seconds and hit connect.

and write a little message. Literally takes 10 seconds to say, hey, heard you on the real estate pros podcast with Dylan or whatever you want to say. And ⁓ and that would be great. You can also go to YonahWeiss.com. As you mentioned earlier, the website talks about everything that we’re working on.

Dylan Silver (19:45)
Yonah, thank you so much for joining us today. Thanks for your time.

Yonah Weiss (19:48)
Pleasure doing, you’re awesome, thanks so much.