True. That&#x27;s why it&#x27;s common to set up two companies, one to own the real estate and one to operate the business. The business rents from the real estate company. This is OK with the IRS as long as the rent is commercially reasonable. Now, the operating company gets to treat the building cost as rent and deduct it. The real estate company gets to deduct mortgage interest and pays taxes only on its profits, the difference between rent and mortgage payments.<p>If the operating company goes bankrupt, it doesn&#x27;t take down the real estate company with it.  The real estate holding company just has to find a new tenant.