Q: It's near the end of the year, and I'm wondering what sort of real estate tax issues should I be aware of?

A: There are numerous real estate tax-related issues that may be important for you to consider at this time. Ultimately, the issues relevant to you will depend on the real estate-related transactions you have entered into in the past or are planning to enter into in the future. Timely real estate transactional planning will help you maximize deductions and minimize taxes.

Common real estate tax issues to consider include home mortgage interest deductions, including prepaid mortgage interest deductions, exclusion or inclusion of income on a sale of residence, tax treatment of 1031 exchanges ("Like-Kind Exchanges"), reporting of rental income, deductions of rental expenses, depreciation of commercial and investment real estate properties, business use of the home, and property inheritance, to name but a few important ones.

Learning real estate tax planning strategy requires first educating yourself using sources available to you. The best source of information is probably the Internal Revenue Service Web site (www.irs.gov). Second, you are well-advised, due to the complicated nature of our tax code, to consult a real estate or tax attorney and/or an accountant.

Q: What is depreciation?

A: In appraisal, a loss of value due to any cause. It can occur due to physical deterioration, functional obsolescence or economic obsolescence.

Have question you would like answered in this column? Please contact James J. Scavo at jscavo@wslaw.net or c/o Weinstock & Scavo, P.C., 3405 Piedmont Rd., Suite 300, Atlanta, GA 30305.

This column is designed to provide information in regard to the subject matter covered. It is not intended to render legal advice.

— By Raghu R. Raju, an associate with Weinstock & Scavo, P.C.; rraju@wslaw.net; www.wslaw.com.