There's this company which is marketing itself as investment vehicle which can be used offset W2 income through depreciation generated by investing in a heavy equipment rentals. More details here: https://ezequipmentzone.com/
Basically
1. Setup a LLC to handle everything below
2. Invest 10% of the money upfront and take a 90% loan from the bank at say 7% (e.g. 30k investment and 270k loan) which is invested in heavy construction equipment
3. Get a write off 300k in first year through section 179 depreciation which passes through to you as the owner
4. Use the depreciation losses to offset any W2 income, then pay taxes on the rental income less the loan interest every year thereafter and make 12-14% returns on your investment
5. They will handle the equipment leases for you etc
The company says they will help you at each step along the way.
So my question is, is this kosher? Would passive activity rules come into play here? What am I missing? They claim it's totally legit.
