What is usually true of the effective tax rate for real estate income property investments?

A.It is less than the investor’s actual tax rate.


B.It is more than the investor’s actual tax rate.


C.It is not affected by the investor’s actual tax rate.


D.It must be equal to the investor’s actual tax rate.

What is usually true of the effective tax rate for real estate income property investments?
It's part of ordinary income and is taxed at the ordinary income tax rate (investor's rate). However, if there is a loss, there are certain situations when it's disallowed: accumulated to be used when either the situation changes or the property is sold.
Reply:The effective tax rate is the total tax divided by total income (NOT taxable income). So if I have income of 50,000, deductions of 10,000 (leaving a taxable income of 40,000) and a tax liability of 10,000, my effective rate is 20%. This sounds like a homework question so I'll leave you to work out the rest.





aaaaaaaaaa would have to cccccccccc that I ddddddon't think it is B.