Offset Your Income
Lower your taxes with real estate. How high earners offset ordinary income, documented with real numbers.
If you earn a high income from wages, a practice, or a business, taxes are likely your largest expense. This site walks through the ways to reduce them, starting with the one we used: a short-term rental.
1. Understand the problem
Ordinary income is taxed at your top bracket. Most deductions do not reach it. Start with how real estate losses can, and when they cannot.
- What counts as material participation for a short-term rental, and how many hours do you need?Most STR owners meet material participation by logging 100+ hours and more than anyone else, or 500+ hours. Here is how the tests work and what to track.
- How can a short-term rental offset W2 income?A short-term rental can offset W2 income when depreciation losses are treated as non-passive, which usually requires a 7-day average stay and material participation.
- What is the STR loophole (7-day average stay) and who qualifies?The STR loophole treats a short-term rental as non-passive when the average guest stay is 7 days or less, so you only need material participation to deduct losses against W2 income.
2. Compare the ways to offset it
A short-term rental is one option among several, with real tradeoffs. See the playbook.
3. See the path we took, with numbers
We bought a Phoenix short-term rental in 2026 and are publishing the numbers, dates, vendors, and mistakes, with sources cited so you can check them.
Full case study coming soon. In the meantime, grab the free cost segregation expense ledger template we built along the way.
All sections
- PlaybookHow high earners can offset ordinary income, how a short-term rental fits, and who it works for.