Real estate partnerships and LLCs may allocate depreciation and other tax items to investors on Schedule K-1. Those deductions can reduce taxable rental income, subject to basis, at-risk, Section 469, and other tax limitations. Partnership real estate investments can pass through depreciation and other tax items that may improve after-tax returns, although the benefit varies materially by investor and by investment structure. Fractional real estate investing has made it easier than ever to access these structures without the traditional barriers of direct property ownership.
This guide examines K-1 real estate investment platforms for investors seeking income, potential appreciation, and pass-through tax characteristics. It starts with mogul, a fractional real estate platform club founded by former Goldman Sachs executives that offers professionally vetted and managed single-family rentals through property-specific LLCs with K-1 reporting.
Disclaimer: The information provided in this guide is for educational purposes only and does not constitute financial, tax, or legal advice. Always consult with a licensed professional before making any financial or investment decisions.
Key Takeaways
K-1 and 1099 investments offer different tax benefits, not automatically superior ones: Partnership K-1 investments can pass through depreciation and losses, but their current use can be restricted by basis, at-risk, and Section 469 loss limitation rules. Conversely, qualified REIT dividends reported on a 1099 can qualify for an up-to-20% Section 199A deduction. Which structure is more tax-efficient depends on the investor and the underlying investment
Entry points vary widely across platforms: Many partnership offerings are built around five- and six-figure commitments, while mogul opens property-level ownership to a far broader group of investors, with an average investment of ~$10k
Property-specific structures offer greater visibility, not automatically deeper deductions: Single-property LLC investments can provide clearer line of sight into the depreciation associated with a particular asset. Both single-property partnerships and diversified real estate funds may use cost segregation and pass qualifying deductions through to investors
Accreditation requirements limit access: Four of the five platforms on this list require accredited investor status. mogul is the only one open to non-accredited investors, subject to onboarding and eligibility requirements
Tax structure differs by offering: Some real estate programs report through partnership K-1s, while others report through a Form 1099. By September 2025, Origin Investments described its IncomePlus Fund as a REIT issuing investors a single Form 1099 rather than a K-1. Tax treatment is determined at the offering level
Bonus depreciation is back at 100%: IRS guidance issued January 14, 2026 confirms a permanent 100% additional first-year depreciation deduction for eligible depreciable property acquired after January 19, 2025. This is directly relevant to cost-segregation planning, though it does not make an entire 27.5-year or 39-year building immediately deductible
1. mogul: Fractional Real Estate for Headache-Free Tax Advantages
mogul delivers a fractional real estate platform club built around single-family rentals held in property-specific LLCs with K-1 reporting. Founded by former Goldman Sachs executives with $10 billion or more in collective investing experience, mogul makes property-level ownership accessible to new and veteran investors alike.
How mogul Works
mogul creates a property-specific LLC (PropCo) for each property in the state where the property is located, uses that LLC as the buying entity, and fractionalizes ownership into shares purchasable in small increments. Investors acquire membership interests in a property-specific LLC that owns a single property, rather than units in a pooled fund, so ownership sits at the entity level for each individual asset. The LLC is structured for K-1 reporting and may pass through proportionate depreciation and other tax items, subject to offering terms and each investor's tax situation.
Key Features:
Investment size: Average investment of ~$10k
Portfolio allocation: $17,321 is the typical portfolio allocation per property
Tax reporting: K-1 forms with potential depreciation allocation
Target returns: 15-20% annual return targets displayed on property cards, against a 12% minimum projected IRR underwriting hurdle. Returns are targets, not guarantees
Average returns: 18.8% average annual returns reported as of April 2025, against the S\&P 500's 9%
Accreditation required: No. mogul accepts both accredited and non-accredited investors, subject to onboarding, KYC, and eligibility requirements
Distributions: Proportional monthly rental income once properties are operational, alongside real-time appreciation and tax benefits
Tax Benefits Through Property-Specific LLC Ownership
mogul's LLC structure is associated with several K-1-relevant tax characteristics:
Property-level depreciation: Investor-level depreciation may offset rental income, potentially producing paper losses while cash distributions continue. Whether an allocated loss can be used currently depends on basis, at-risk, and Section 469 limitations
Cost segregation potential: Cost-segregation strategies may be available at the property or entity level where applicable, with the depreciation methodology for each offering set out in that offering's documentation
QBI deduction eligibility: Eligible rental income may qualify for an up-to-20% Section 199A deduction where applicable requirements are satisfied. Eligibility is not determined solely by using an LLC
Capital gains treatment: Qualifying gain on a long-held property may receive long-term capital-gains treatment, while depreciation recapture and other investor-specific rules may also apply
What Makes mogul Unique
Goldman Sachs SFR leadership: Co-founder Joey Gumataotao grew Goldman Sachs' SFR platform from $0 to $1 billion in under 12 months with a team of three
Property selection rigor: Less than 1% of reviewed properties pass mogul's sourcing, underwriting, inspection, and internal investment-committee process
Loss protection: First $10k protection for new members, with mogul covering up to $10k in losses in year one
Member referrals: Give $50, Get $50. Refer a friend and get $50 when they invest
Community rewards: Community features like mogul Clubs, which distribute up to 2% in rewards to members
Platform co-investment: mogul personally invests in every listed rental-property strategy, aligning interests with investors
Investor scale: 40,000+ investors on the platform, with 90% of investors investing a second time, and typically at 3x their first investment when they do
Assets on platform: $90M+ invested through the platform
Best For: First-time real estate investors and tax-savvy allocators seeking property-specific K-1 reporting without accreditation requirements or six-figure minimums. Explore available properties to see current opportunities.
2. First National Realty Partners (FNRP): Commercial Real Estate for Diversified Portfolios
First National Realty Partners focuses on grocery-anchored commercial real estate, providing partnership investments in necessity-based retail properties. The platform serves accredited investors and positions necessity-based retail as relatively resilient across economic cycles.
Core Capabilities
FNRP's "Dragnet Acquisitions Model" screens thousands of properties annually to identify opportunities in grocery-anchored shopping centers. The focus on necessity-based retail, including grocery stores, pharmacies, and essential services, is intended to provide defensive characteristics during economic downturns.
Key Features:
Minimum investment: $50,000
Tax reporting: Schedule K-1 for partnership and LLC offerings. FNRP publishes investor guidance on pass-through real estate tax benefits
Accreditation required: Yes
Distributions: Generally structured on a quarterly basis depending on the offering. Cash distributions are not guaranteed
Portfolio: 65+ properties across 26 states, over 12 million square feet
K-1 Benefits from Commercial Real Estate
Commercial properties carry distinct tax characteristics:
Longer depreciation schedules: Nonresidential real property generally uses a 39-year recovery period, providing sustained deductions over extended holding periods
Triple-net lease structures: Many retail properties feature NNN leases where tenants pay specified operating expenses, shifting those cost obligations away from the landlord
Cost segregation opportunities: Component-level depreciation studies can accelerate deductions on qualifying building systems and improvements, and shorter-life components may be eligible for the 100% additional first-year depreciation deduction
Investment Approach
FNRP provides detailed property information including location demographics, tenant credit quality, and lease terms for each offering. The platform hosts live webinars for each new investment opportunity with Q\&A sessions.
Note on track record: FNRP publishes portfolio, distribution, and operating milestones, including investor distribution totals. Platform-wide performance is presented at the sponsor level.
Best For: Accredited investors seeking necessity-based commercial real estate exposure with K-1 tax reporting and a quarterly distribution structure.
3. DLP Capital Housing Fund: Impact Investing with Tax Advantages
DLP Capital Housing Fund combines workforce housing investment with institutional-grade returns, offering K-1 reporting alongside a social mission focused on attainable housing.
Investment Focus
The fund targets attainable workforce housing. DLP describes attainable workforce households as generally earning roughly 80% to 120% of Area Median Income and evaluates affordability partly by the share of household income devoted to housing, using a benchmark of roughly 30% of gross income spent on housing costs. This "attainable housing" focus addresses a genuine market need while generating returns.
Key Features:
Minimum investment: $500,000
Tax reporting: K-1 forms
Performance: 16.20% compounded DRIP IRR since January 2020 inception, as reported by the sponsor
Preferred return: 6% annual, paid monthly
Accreditation required: Yes
Portfolio: 50 properties totaling more than 12,300 apartment units as of June 30, 2026
K-1 Tax Advantages
DLP emphasizes tax efficiency as a core fund benefit:
Depreciation offset: DLP reports that depreciation has offset the fund's ordinary income since inception. Individual investors' ability to use allocated deductions depends on their own basis, at-risk, and Section 469 circumstances
QBI deduction: DLP states that the Housing Fund may generate QBI-eligible income. Eligible investors may qualify for an up-to-20% Section 199A deduction, subject to applicable requirements and limitations
Cost segregation studies: Depreciation acceleration across the multifamily portfolio, with qualifying shorter-life components potentially eligible for current bonus depreciation rules
Property-level exchange activity: The fund may execute property-level tax-deferred transactions such as a 1031 exchange. Note that an investor's partnership or fund interest is generally not itself qualifying replacement property for a Section 1031 exchange
Fee Structure and Liquidity
The fund offers volume discounts on investments of $1 million or more, with additional reductions at $10 million and $25 million thresholds. Liquidity is provided through annual redemption periods, a different cadence from platforms offering quarterly redemptions.
Best For: High-net-worth investors and family offices seeking K-1 tax reporting combined with impact investing in workforce housing.
4. EquityMultiple: Accessing Institutional Real Estate Deals with K-1s
EquityMultiple provides diversified commercial real estate investments across debt, preferred equity, and common equity structures. The platform offers multiple investment types with varying K-1 and 1099 tax treatments.
Three Investment Pillars
EquityMultiple organizes offerings into three categories:
Keep (Alpine Notes): Short-term notes offered in 3-, 6-, and 9-month terms with fixed APYs that vary by term and offering. These issue 1099-INT forms
Earn (Debt/Preferred Equity): Income-focused investments with regular distributions
Grow (Common Equity): Appreciation-focused investments with K-1 reporting and depreciation pass-through
Key Features:
Minimum investment: As low as $5,000. EquityMultiple states that minimums typically range from $10,000 to $30,000, with product-specific exceptions. Ascent applies a $5,000 first-time investor minimum and a $20,000 minimum for existing investors
Tax reporting: K-1s for LLC-SPV equity investments and for the Ascent Income Fund; 1099-INT for Alpine Notes
Accreditation required: Yes
Transaction volume: More than $4 billion in commercial real estate transactions through the platform
K-1 Considerations
For equity investments, EquityMultiple provides K-1 forms with pass-through depreciation and partnership income treatment. The Ascent Income Fund reports through a single federal K-1 and distributes quarterly.
Operational Note: K-1 timing on partnership offerings depends on sponsors and other parties. EquityMultiple's Tax Tracker provides document status and estimated timing.
Note on track record: EquityMultiple publishes realized-deal performance data at the platform level.
Best For: Accredited investors seeking diversified commercial real estate exposure across multiple investment structures and risk profiles.
5. Syndicated Equities: Diversified K-1 Opportunities Across Property Types
Syndicated Equities provides real estate joint ventures across the broadest range of property types on this list, offering investments spanning 10 listed asset classes.
Asset Class Diversity
The platform's property types include:
Retail and net lease properties
Office buildings
Industrial facilities
Medical office buildings
Multifamily apartments
Student housing
Hospitality assets
Parking structures
Self-storage facilities
Co-living properties
Key Features:
Minimum investment: By inquiry
Tax reporting: Partnership and LLC investments issue Schedule K-1s; DST investments use Grantor Statements
Accreditation required: Yes
Structure: Direct and joint-venture partnerships
Focus: Value-add and ground-up development opportunities
Securities offering: Securities are offered through Metropolitan Capital Investment Banc (MCIB), a FINRA and SIPC member
K-1 Benefits Across Property Types
Different property types offer varying depreciation schedules and tax characteristics:
Residential: Residential rental property generally uses a 27.5-year recovery period, faster than nonresidential real property
Commercial: 39-year recovery period with cost segregation potential
Ground-up development and acquisitions: Properties may contain qualifying shorter-life components identified through cost segregation that are eligible for accelerated or 100% bonus depreciation under current law. The underlying 27.5-year or 39-year building is not automatically eligible in its entirety
Net lease properties: Triple-net structures shift specified operating cost obligations to tenants
Asset Management Approach
Syndicated Equities provides comprehensive oversight including property management coordination, leasing, financing, budget reviews, and disposition planning. Investors access tax documents, distribution information, and operating data through an online portal.
Best For: Accredited investors seeking K-1 reporting across diverse property types who want exposure beyond residential or traditional commercial real estate.
Why mogul Stands Out for K-1 Real Estate Investing
Most Accessible K-1 Investment Platform
mogul lowers the traditional barriers to K-1 real estate investing. The other platforms on this list carry stated minimums running from $5,000 to $500,000 or accept capital by inquiry only, and all four require accredited investor status. By contrast, mogul is open to both accredited and non-accredited investors, subject to onboarding and compliance requirements, with an average investment of ~$10k. Most high net worth individuals and family offices allocate 23% of their portfolios to real estate, and mogul is built to help investors construct portfolios like the wealthiest investors in the world for a fraction of the time and cost.
Rigorous, Repeatable Property Selection
The mogul team brings former Goldman Sachs real estate experience to every acquisition. With less than 1% of reviewed properties passing the sourcing, underwriting, inspection, and internal investment-committee process, mogul concentrates on professionally vetted and managed properties. The proprietary underwriting combines financial modeling and base, bull, and bear scenario analysis with automated valuation models and comparative market analysis tools.
Property-Specific LLCs for Transparent Tax Reporting
Unlike pooled funds or REIT structures, mogul places each property into its own state-registered LLC, and each investment club is associated with a single property. This structure delivers:
Property-specific K-1s: Each property-level LLC provides property-specific K-1 reporting. Investors in multiple property LLCs can generally expect a separate K-1 for each applicable LLC
Cost segregation potential: Cost-segregation strategies may be available at the property or entity level where applicable, subject to the specific offering
QBI eligibility: Eligible rental income may qualify for an up-to-20% Section 199A deduction where the applicable requirements are met
Property-level tax visibility: Property-specific LLCs provide property-level tax reporting and visibility rather than blending multiple properties into one pooled-fund K-1. mogul states that it provides property-level LLC documentation, partnership tax forms, and depreciation data
Understanding why real estate provides these advantages helps contextualize mogul's structural benefits.
Aligned Interests and Downside Protection
mogul personally invests in every listed rental-property strategy, ensuring management interests align with investor returns. The $10k protection for new members reflects confidence in the property selection process, with mogul covering up to $10k in losses in the first year.
Proven Performance
mogul reports 18.8% average annual returns as of April 2025, with 15-20% annual return targets displayed on property cards and a 12% minimum projected IRR underwriting hurdle. Returns are targets and past results, not guarantees. The platform's single-family rental focus captures an asset class that delivered a 13.8% IRR from 1993 to 2023 against 9.8% for the S\&P 500, and that over a 30-year hold has on average returned 190% higher with 45% less volatility.
Headache-Free Experience
From an investment process that mogul says can be completed in under 30 seconds to professional property management, mogul and its property-management partners handle day-to-day operations, while investors retain governance rights over specified major decisions, including decisions above $1,000. Investors receive monthly distributions, yearly tax documents, and pro-rata governance rights, without tenant calls or maintenance coordination.
For investors seeking K-1 tax reporting with rigorously underwritten single-family real estate, mogul offers an accessible entry point combined with a sub-1% property acceptance rate and sponsor co-investment in every deal. Browse available properties, use the free rental property calculator to analyze potential investments, or schedule a call with the team.
Disclaimer: The information provided in this guide is for educational purposes only and does not constitute financial, tax, or legal advice. Always consult with a licensed professional before making any financial or investment decisions.
Frequently Asked Questions
What exactly is a K-1 in real estate investing?
Schedule K-1 is an IRS tax form that reports your share of income, losses, deductions, and credits from a pass-through entity like a partnership or LLC. It is a reporting document: it does not itself create depreciation. In real estate, K-1s matter because the underlying entity can allocate depreciation deductions that offset rental income, potentially reducing your taxable income from that activity below what you would report on equivalent 1099 income. K-1s report your proportional share of the underlying property's tax characteristics, not just the cash you received.
How do K-1 real estate investments provide tax advantages?
The advantage comes primarily from depreciation allocated through the partnership. When a property is held in an LLC or partnership, a portion of the property's depreciable basis is deducted each year, which can cause taxable rental income to be lower than cash distributions or generate a tax loss. Whether that loss can be used currently depends on basis, at-risk, and Section 469 limitations, among others. Additional potential benefits include an up-to-20% Qualified Business Income deduction where the rental activity qualifies, and long-term capital gains treatment on qualifying gain.
Are K-1 real estate investments suitable for all investors?
The value of depreciation generally increases with marginal tax rates when the deductions are currently usable. However, high income does not automatically make those deductions easier to use: Section 469 rules can suspend rental losses, and the special rental real estate loss allowance carries a modified adjusted gross income limitation. K-1s also involve additional considerations: you may need to file in multiple states if properties are located across different jurisdictions, and K-1 forms are generally issued later in the season than 1099s. Investors prioritizing tax simplicity may prefer 1099-reporting investments like REITs, whose qualified dividends can also carry an up-to-20% Section 199A deduction. Consult a tax professional to determine which structure aligns with your situation.
What's the difference between fractional ownership and a real estate fund for K-1 purposes?
Fractional platforms like mogul provide membership interests in property-specific LLCs, generating property-specific K-1s tied to a single asset. Real estate funds pool investor capital across multiple properties, issuing a single K-1 that blends tax characteristics from the entire portfolio. Property-specific LLC investments may provide greater visibility into the depreciation associated with a particular asset. Both single-property partnerships and diversified funds may use cost segregation and pass qualifying deductions through to investors, so the difference is primarily one of transparency rather than an automatic difference in deduction size.
How does depreciation work with K-1 real estate investments?
Depreciation allows recovery of the depreciable basis of qualifying property over its applicable recovery period. Land itself is not depreciable. Residential rental property generally uses 27.5 years; nonresidential real property generally uses 39 years. With K-1 investments, your proportional share of this depreciation flows to your personal tax return, reducing your taxable income from the property, subject to the usual limitations. Cost segregation studies can accelerate depreciation by identifying qualifying building components such as HVAC systems and fixtures, and current law provides a permanent 100% additional first-year depreciation deduction for eligible property acquired after January 19, 2025. On sale, gain attributable to prior depreciation may be treated as unrecaptured Section 1250 gain and taxed at a maximum federal rate of 25%, but the interim tax deferral provides substantial time-value benefits.
What should I look for in a K-1 real estate investment platform?
Prioritize platforms offering property-specific ownership structures, transparent depreciation reporting, and alignment through sponsor co-investment. Track records are most useful when they are dated and current and define their calculation methodology and measurement date. Fee structures and tax treatment are both set at the offering level, and reporting can range from partnership K-1s to Form 1099s and, for DST investments, Grantor Statements. For accessible K-1 investing with disciplined property selection, mogul provides an accessible entry point, a sub-1% property acceptance rate, and first $10k protection for new members, with mogul covering up to $10k in losses in year one.