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

Tax Depreciation: Big Savings or Big Surprise? #shorts

16 Aug 2026 · 0 min

Watch on YouTube

0:26

In this YouTube short, Tommy Dobczyk walks through a rapid calculation to illustrate how tax depreciation affects a large tax liability. He starts with a $1.6 million tax bill and notes that depreciation on a newly purchased building provides $230,000 of tax relief each year over a 39‑year schedule. By applying that annual relief, the remaining tax bill after depreciation is roughly $1.1–$1.2 million. Tommy emphasizes that the initial $1.6 million set aside for taxes is reduced by the depreciation allowance, but the taxpayer still faces a substantial balance, highlighting the cash‑flow timing considerations when using depreciation to offset tax obligations.

Somebody do the math real quick on that. So at a tax relief of $230,000 per year and you have a $1.6 million tax bill, somebody do the math on that. You still got to do like a $1.1, $1.2 million tax bill, right? And you only had, you only had $1.6 to start out, right? Like you kept, you held aside $1.6 to pay taxes with, but when you went and bought the building, it's only going to let you depreciate it $230,000 at a time for 39 years. How