Hello Bin I moved out from my first primary home and I bought a different home before I sold the first home. 2 years later I sold my first primary home after I fixed up. How does this do on taxes? Thank.
The last part about deducting the property losses from your W2 income is WRONG!!! Check with your CPA, the losses on rental property income is passive and can ONLY reduce income from another passive income, which your W2 is NOT.
I heard that after 3-year of operating under net loss, then it will considered a hobby and you no longer can claim taxes. Is this correct? I’m based in California.
Quick question on this: any tax benefits for purchasing properties under a parent LLC vs. individual/sole entity (yourself) besides protection of personal assets from the LLC?
The only thing I can think about off the top of my head is the mortgage interest deduction, its capped at a 750k mortgage but LLCs can use commercial loans which I believe doesn't have a limit unless you make 25m in 3 yrs. So I don't have to worry about the commercial loan limit anytime soon haha. In most instances it should be the same since most people don't have to get a 750k mortgage but there are also talks about chance of getting audited if you write off too much business expenses as an individual. This may or may not be true I've just heard about it. There are many it depends type of scenarios so I definitely recommend talking to an accountant about your personal situation.
I like the saying, "It's not about how much you make, it's how much you spend." better. Easier to control your expenses than your income or your tax liability.
If as a parent I give my title of my property to my son and then rent it back from him...can he keep it as rental property to me and will he be able to deduct all the rental expense. Pease let me know. Thanks
I think I understand. You make $44k. The only money you properly keep in a bank account is the depression $14.5K. everything thing else is just matching what you spent. So in all actuality you pay 0%Tax. However you have $14.5k in the bank but you also have about $8k-$11K growth if market goes up and paying off loan. So you truly made about 25K that year tax free. Is this correct?
Everyone needs and loves this type of clips, i mean who likes paying taxes. Lucky you that you know so much stuff about it, imagine how much money you save for yourself! Well done and thanks for taking time to share your knowledge with us! 😁👍🔔
Thank you so much for this! I needed to know this write off! I made a financial video on my channel and it linked me to you! You’ve earned a new subscriber and supporter! Keep doing great things!
Did you make a mistake when talking about depreciation? You said 500K property .. so 100k for Land and 400K for the building.. did you mean to say 400K divided by the 27.5 years and not 500K divided by? 2:57
Can you explained once you received rent how to put it on a spreadsheet to present it to the CPA please (how to spread the collected rent to pay a little tax legally)
Great video! Exactly what I need. I will refer back to this video before I do my taxes. I used turbotax last year to do my taxes on my rental income and earned income. Hope I didn't overlook any tax breaks...
I always get excited about Real Estate when hearing all the tax advantages. Question though. What if we have dual purposes for some of our business expenses. Such as traveling to go see the property but also using that business trip for recreation. Or having a cell phone to reach tenant but also using it for personal use?
So that's the grey area for tax. If your trip was for business but while you're there you decide to go somewhere for recreation you can still deduct the travel and hotel expenses. If you stay an extra night for recreation then you can deduct that night. Its all about the intent. As for the phone thing its by usage. When you file your taxes you can state something like 50% business 50% personal or 30/70. These business expenses can be taken for any business not just real estate. I would double check with a local accountant though since there might be state specific rules.
Just discovered your videos. Thanks for the info! Question, at what point would you recommend to open an LLC or some other way for the extra benefits like paying my company to manage the property, etc.? I am looking a buying my 1st rental property.
Benefit of having an LLC own the rental is to protect you personally. Example someone gets hurt on your property and they sue you. If you own it personally everything you own is at jeopardy like personal house, cars, 401k amd so on. If the property is owned by an LLC only the assets owned by the LLC in this instance the rental or the equity in that property is at risk. Tax wise it won't make a difference because whether it's income from the rental or the LLC it still transfers to your tax return in the same way.
I was advised that an LLC it need it even for one property that way you can save in taxes and avoid claims against you but don't put the LLC with your address,if you want to go forward created an Land Trustee .
Great Video, Thank you. How do you own a property on LLC do I have to have a lawyer? I am just starting on invest a property and rent it. Thanks for the help.
