Tax Breaks, Tax Bill 💸 😮‍💨

Brock's newsletter | JULY 24, 2026

Tax Breaks, Tax Bill

We are almost done with our taxes and will file four months late, which is nothing new, but each year I resolve to get everything together by March. I tried like hell this year to file on time, but well, there are a lot of moving parts.

I’m hoping that what we paid the IRS and FTB (the state) back in April covers our entire tax bill – remember, when you get an extension on your taxes, you have to pay what you think you’ll owe. If you're wrong and pay too little, they hit you with serious penalties.

But we might owe more anyway – our long-suffering CPA is grinding through it all now. Fingers crossed.

Every year I ask him, “Anything we could be doing to save more in taxes?” He always replies, “Nothing. You chose real estate, it’s the most tax-advantaged industry in America.”

There are so many ways that owning real estate can off-set your taxes. Depreciation, mainly (we have been doing a lot of cost segregations over the past few years). Also, the mortgage-interest tax deduction. And as real estate professionals, we can write off our investments against our income, a unique benefit of our field.

Still, we pay a lot. I hope it goes to good use. I just learned Australians get an itemized receipt with their tax bill showing where every penny goes. Great idea.

And it’s a lot of work. I’m Mr. Organized, yet I constantly get tripped up. We are all the CFO’s of our own lives and it's easy to get overwhelmed.

Some people just give up. I had a friend who was so confronted by his taxes he hadn’t filed a return in 5 years. I frog-marched him into H&R Block and he safely estimated everything and filed all five years in one day, and didn’t owe anything! He was so relieved.

The smart ones who can’t do it, outsource it entirely.

Business Managers

We have multiple Hollywood creative friends with business managers, whom we often deal with when selling houses. Imagine paying someone 3-5% of your gross income, having all your mail go to them, and they pay everything and track everything. They handle investments and often do tax returns.

Sounds like heaven, especially if the clients (our friends) are self-confessed head-in-the-clouds artists who can’t open a letter.

You still have to read your statements. You could almost lose properties to foreclosure, like Sophia Amoruso, whom I wrote about a few months ago – her business managers forgot to pay property taxes on two of her lots.

Or Alanis Morisette, whose money manager stole $7mil.

But it sounds like a useful service, and I think this business might spill over from Hollywood into the general population in due time. Full-service money management? Sign me up.

Back to Real Estate

Yes, we owe a lot this year, and we will next year, but we would owe way more if we didn't own real estate.

People usually think of investment property as a way to build wealth over time—and it is. Especially now when houses are expensive and rates are high, and nothing pencils (you'll put a six-figure down payment to break even on most investment properties), you have to let time do its magic to see big returns on real estate.

But there are now benefits.

The mortgage interest deduction lets you subtract the interest paid on a home loan from your taxable income. There's other creative ways to use your home to lower your taxes – consult your CPA.