Does the cash-on-cash return in a real estate investment include income taxes?
Yes. Your ability to deduct the mortgage interest on your income tax return reduces your cash outflow related to the real estate purchase. So, it should be figured into the cash-on-cash ROI (Return of investment) calculation. Depends on the number you are looking for. Generally a net cash on cash would include income taxes taken out since you still have to pay cash for income taxes. But depends on a what you are trying to look at. Larger companies may look at a EBITDA return etc.
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