After-Tax Cash Flow
See how depreciation boosts your real cash flow through the Cash Flow from Depreciation™ concept.
Cash Flow from Depreciation™ Explained
Most investors focus on before-tax cash flow: rent minus expenses minus mortgage. But depreciation creates a tax deduction that puts real dollars back in your pocket. Cash Flow from Depreciation™ is the annual tax savings generated by the depreciation deduction. When you add this to your before-tax cash flow, you get True Cash Flow™ - the actual money you keep after accounting for the tax benefit of depreciation.
- Cash Flow from Depreciation™ = annual depreciation x income tax rate
- True Cash Flow™ = before-tax cash flow + Cash Flow from Depreciation™
- A property with negative pre-tax cash flow can be positive after depreciation
- This is real money: lower tax bill means more dollars in your bank account
Before-Tax vs. After-Tax Comparison
The calculator shows before-tax and after-tax cash flow side by side for every year of your hold period. The gap between them is exactly the Cash Flow from Depreciation™ — the hidden cash flow that many investors miss entirely. For a $400,000 property at a 29% combined tax rate, this adds $3,374 per year to your effective cash flow.
- Grouped column charts show before-tax vs True Cash Flow™ by year
- The green "boost" bar visualizes the depreciation benefit clearly
- Effective tax rate shows what you actually pay vs. your marginal rate
- Recapture exposure box warns you about the tax due if you sell
Sample Output
See what this feature calculates for you.
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