Tommy DobczykOpportunity Zone Advisor, OZ Wizard · Director of Development | Certified Opportunity Zone Advisor

IRS Tax Rule SHOCKS Investors: Write-Offs Explained! #shorts

14 Aug 2026 · 1 min

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In this YouTube short, Tommy Dobczyk walks viewers through the IRS’s default depreciation rule for commercial real‑estate: a 39‑year straight‑line schedule. Using a concrete example, he shows that a $3 million building can only be written off at roughly $150,000 per year, leaving the investor with a massive unrecovered cost. He highlights the disconnect between the cash outlay and the allowable tax deduction, prompting viewers to consider cost‑segregation strategies or other ways to accelerate depreciation. The segment is framed as a cautionary illustration for investors who assume they can immediately deduct the full purchase price.

Chapters

The cost segregation side of things is Michael bought the building with $3 million. So when he bought it, the IRS says you can only write off— you have to take the $3 million and divide it over 39 years. And then you can write that off every year for 39 years. So if you take 39 and divide that by $3 million, it's only like $150,000 a year. Michael's got a $3 million tax bill. So he spent that on the building, but he only got a $150,000 deduction. Does that make sense? No. Well, does it? Does it? Like he still has to— he only gets to deduct $150,000 instead of $3 million. He's got to figure out where to come up with another 3— another $2,900,000, $2,800,000, right?