4. Depreciation an real estate investments Depreciation is a tax deduction that recognizes an asset's Remember the following real estate-related Ins Guidelines when answering the questions that follow regarding Madeline's and fileen's real nstate holdings. Be sure to round each of your answers to the nearest whole dollar, Madeline's Real Estate - Depreciation and Tax Consequences Madeine inveited $400,000 in real estate {$340,000 for an apartment building and $60,000 for the land). The property enjoys full occupancy; tenants include families, students, and seniors. Madeline can deduct in depreciation per year on her taxes. Madeline's rental income in the first year of ownership was $48,000. By occupying the 25% income tax bracket, she will save in taxes by taking the depreciation deduction. Elleen's Real Estate - Depreciation and Tax Consequences Eleen ifvested $850,000 in real estate (5637,500 for an office bulling and $212,500 for its fand). The property enjoys full occupancy; tenants: include an assartment of businesses. Eleen can deduct in depreciation from her taxes, By the end of her first year of ownership, Eileen earned 5127.500 in rental income. If she pays income taxes at the rate of 25%, then she will save in taxes by taking the depreciation deduction. Alison's Real Estate - Depreciation and Tax Consequences Alison purchased 10 acres of land in the country for $220,000 as an investment. She leases the property to a local nature club whose members use it for hiking and bird watching. As a fesult, Alison can deduct in depreciation from her taxes. If the gross annual rental income on Alson's property is $22,000 and she is taved at the marginal rate of 25%, then she will be able to save on her taves as a rewit of the depreciation deduction