Tax Planning and Advisory for Real Estate Developers, Syndicators, and Sponsors

Depreciation is passed through to investors based on their ownership share, and how it's allocated depends on the entity structure and waterfall. We help make sure it's set up correctly from the start so K-1s come out right every year.

A waterfall allocation determines how profits and cash flow are split between the sponsor and investors as return thresholds are hit, and each tier can be taxed differently. We help you understand the tax impact before the deal is finalized, not after.

In most cases, yes, keeping each deal in its own entity limits liability and keeps the accounting and K-1s clean. Financing often requires it too, since lenders frequently want each project isolated in its own entity. We'll walk through the tradeoffs for your specific structure.

We prepare and deliver K-1s for each investor based on their allocated share of income, loss, and depreciation, and make sure they're accurate and on time.

Once investors clear their preferred return, the sponsor receives a promote, an extra allocation of profits above what their capital alone would justify, as their reward for putting the deal together and managing it. That's separate from the sponsor's own investment, which is the capital they put in alongside everyone else and is treated like any other investor's stake. We make sure each piece is tracked and reported correctly.