straight-line depreciation

Definition

A tax deduction method that spreads a property's cost evenly over its useful life (27.5 years for residential). The IRS's gift to real estate investors, assuming you can wait three decades.

Example Usage

Using straight-line depreciation, she deducted $10,909 annually from her taxable income on the $300,000 rental property.

Origin

Accounting terminology adopted into real estate taxation under IRS regulations

Fun Fact

Land can't be depreciated—only the structures—because apparently dirt is immortal according to the tax code.

Source: Real estate taxation and accounting terminology

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recorded plat

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quit claim deed

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conveyance

The fancy legal term for transferring property ownership from one party to another, complete with all the paperwork that makes it official. It's both the act of moving title and the document that proves you now own that thing. Real estate's way of saying 'this is yours now' in the most formal way possible.

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earnest deposit

Money put down to show a seller you're serious about buying their property, essentially a financial hostage that says 'I mean business.' If you back out without a valid contingency, kiss that money goodbye.

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legal description

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