Present-day tax benefits include tax deductions for depreciation, the deferment of capital gains when property is exchanged and deductions of losses from real estate investments.  A buyer of investment property should seek professional tax advice to keep abreast of the changing laws.

A capital gain is considered a short-term gain if the asset is owned for 12 months or less.  It is considered long-term if the asset is owned for more than 12 months.  The maximum tax rate on long-term capital gains is 10 percent for taxpayers in the 15 percent tax bracket and 20 percent for all others.