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real estate tax tips: 25 Minute Webinar this Friday - 04/22/09 03:29 PM
No one ever believes me about this webinar, and I don't blame them. I know it's the greatest thing since sliced bread, but convincing others is not such an easy task. So I'll leave it up to the pros!
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real estate tax tips: Real Estate Taxes - 04/15/09 01:17 PM
Last Minute Tax Tip - Real Estate Taxes
Taxes paid on property assessed by a local government or other taxing authority are deductible when paid.
Common fees include taxes paid to your city, county, or school district.
If you have a mortgage, usually the total amount is reported on your mortgage interest statement (IRS Form 1098). In addition to real estate taxes, the interest recipient may use box 5 to give you other information, like the address of the property that secures the debt, and insurance paid from escrow.
Real estate taxes get reported on Schedule E if … (0 comments)
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real estate tax tips: Why You Should HIRE FAMILY MEMBERS - 04/14/09 03:42 PM
Last Minute Tax Tip - Hire Family Members to Manage Your Properties
Property management fees are fully deductible, so consider hiring someone that you don't mind paying, like a family member.
Obviously, the expense of your own labor cannot be written off, but that doesn't mean your spouse or children have to work for free.
By hiring family members, it won't bother you to pay management fees because the expense is fully deductible, and the money stays within your family :)
Keep in mind you'll have to withhold Social Security and Medicare taxes for the income you pay.
AND … (17 comments)
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real estate tax tips: Collecting in Advance - 04/13/09 03:27 PM
Last Minute Tax Tip - Collect Rent in Advance to Offset Loss Carryovers
One main benefit of owning rental property is being able report a loss, but some taxpayers cannot take advantage of this tax shelter due to high income loss limitations. Their losses get carried forward, and cannot get deducted until they are offset with future income.
If your rental expenses exceed rental income, and your AGI limitations do not allow you to claim a loss, you can decrease the loss carryover by increasing rental income. Since rental income is taxable in the year it is collected, rental losses … (0 comments)
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real estate tax tips: Traveling Away From Home - 04/12/09 01:09 PM
Last Minute Tax Tip - Traveling Away from Home
You can deduct the expense of traveling away from home if the primary purpose of the trip was to collect rental income or to manage, conserve, or maintain rental property.
You can also deduct expenses incurred while staying overnight when traveling for business. You cannot deduct the cost of traveling away from home if the primary purpose of the trip was the improvement of your property. You can read Publication 463 to learn the specifics.
Everyone's tax situation is different, and this information should not substitute professional advice. Taxpayers should … (3 comments)
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real estate tax tips: Expenses that can be Written Off Immediately - 04/09/09 12:54 PM
Last Minute Tax Tip - Repairs due to Vandalism can be Expensed Immediately
If rental property is damaged by vandalism, the cost of repairing the property to its previous condition is immediately deductible instead of being capitalized and depreciated.
For example, say you replaced an entire window frame on your property. Normally the cost would get added back to the basis and depreciated because windows are a component of the building structure (depreciated over 27.5 years). However, since the improvement is the result of vandalism, it is treated like a repair, and the costs are deducted in the year the … (1 comments)
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real estate tax tips: 1 out of 5 Buyers is WHAT? - 04/08/09 05:29 PM
1 out of every 5 buyers is an investor!!!
This was again confirmed by NAR in their latest annual study on second homes and investment purchases. They found that purchases for investment purposes accounted for more than one out of five home sales in 2008. Second homes and vacation property purchases dropped last year to 9 percent of the total market, down from 14 percent in 2006.
Here are some other interesting findings:
66% of what investors purchased last year was detached single family units, 22% were condos or duplexes, and only 8% of purchases were multi-units, attached townhouses, … (11 comments)
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real estate tax tips: You can do WHAT with Health Insurance? - 04/08/09 02:28 PM
Last Minute Tax Tip - Making Health Insurance a Rental Expense
Costs to insure rental property are deductible, so depending on how you structure your rental business, you may be able to cover your life and medical insurance as part of the rental business.
Structuring your rental property as a Limited Liability Company (LLC) may permit you to deduct these costs for you and your family, but you should talk to a tax advisor to find out more. Everyone's tax situation is different, and this information should not substitute professional advice. Taxpayers should always consult with their tax advisors to … (0 comments)
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real estate tax tips: Giving Gifts that Lower Taxes - 04/07/09 01:53 PM
Last Minute Tax Tip - Giving Gifts and Lowering Taxes
If you give gifts in the course of your business, you can deduct all or part of the cost, but you cannot deduct more than $25 for each business gift that you gave away during the tax year.
A gift that is intended for the eventual personal use or benefit of a particular person or class of people will be considered a gift to that person or class of people. If you give a gift to a member of a customer's family, the gift is generally considered to be an … (2 comments)
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real estate tax tips: Pay your Kids, so they can Pay for Themselves! - 04/06/09 05:02 PM
Last Minute Tax Tip - Pay your Kids and Open their IRAs
If it looks like you will have a large taxable liability at the end of the year, it's not a bad idea to hire your kids to landscape your rentals.
You can pay your kids to do work on your properties, and put the money in IRA accounts for them. This is especially a good idea if you’ve already maxed out on your and your spouse’s IRA contribution for the year. You’re better off avoiding the taxes on your extra income, and the money will be safe in … (9 comments)
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real estate tax tips: Deductible Start-Up Expenses - 04/04/09 12:42 PM
Last Minute Tax Tip - Deductible Start-Up Expenses
Business start-up costs are generally capital expenditures, but you can elect to deduct up to $5,000 of business start-up costs incurred in 2008. The $5,000 deduction is reduced by the amount your total start-up costs exceed $50,000, and the remaining cost must be amortized.
Start-up expenses are costs incurred while creating an active trade or for investigating the creation of a business or trade. This includes expenses incurred when acquiring an existing for profit activity, as well as expenses incurred during the anticipated production of income. Common start-up expenses may include: Accounting … (3 comments)
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real estate tax tips: Ordinary and Necessary Advertising Expenses - 03/31/09 02:45 PM
Last Minute Tax Tip - Ordinary and Necessary Advertising Expenses
Be sure to deduct any advertising expenses that are considered “ordinary and necessary” for your rental property.
Common expenses can be advertisements on the radio, in the newspaper, classified lists, and phone books. Other expenses may include the cost of signs, banners, and postage for mailers. You can even deduct the cost of advertising for vacancies, including the cost of building a web site – just be sure that they are “ordinary and necessary” for your rental activity.
Click here for the other tips. To learn more about saving money … (6 comments)
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real estate tax tips: Deducting the Cost of Looking for Property While on Vacation - 03/30/09 08:35 PM
Last Minute Tax Tip - LOOKING for new property while on vacation
Be sure to deduct the cost of expenses incurred while looking for new property. Travel expenses in connection with the management of your investments are tax deductible if they are ordinary and necessary.
At least half of the time you spent away on travel must have been spent doing business, and the primary cause for travel must be business. Common business expenses that you can deduct while scouting for new investment properties are fees for travel, lodging, and services.
Click here for the other tips. To learn more … (4 comments)
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real estate tax tips: Last Minute Tax Tip - Rental income - 03/24/09 04:08 PM
Last Minute Tax Tip - Rental Income
The lower your rental income for the year, the less that you will owe in taxes. By minimizing your rental income, you can reduce your taxable liability.
This does not mean you should stop collecting rent, it just means you might not have to include all the rent you've collected in your taxable rental income.
You don't have to report your rental income if you rented out your property or vacation home for 14 days or less. Rental income is taxable in the year it is collected. If you did not receive … (8 comments)
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real estate tax tips: Expanded Tax Break for First Time Home Buyers - 02/25/09 01:56 PM
The IRS announced that taxpayers who qualify for the first-time homebuyer credit and purchase a home this year before December 1st can take the tax credit either on their 2008 tax returns this year or on their 2009 tax returns next year. They do not have to repay the credit, provided the home remains their main home for 36 months after the purchase date. They can claim 10 percent of the purchase price up to $8,000 ($4,000 for married individuals filing separately), and the amount of credit begins to phase out for taxpayers whose adjusted gross income is more than $75,000, … (2 comments)
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real estate tax tips: New federal tax break for first-time home buyers - 02/23/09 05:45 PM
Here are details of the new federal tax break for first-time home buyers:
– It’s for new and existing homes purchased between Jan. 1 and Dec. 1, 2009.
– Buyers get a tax break equal to 10% of the purchase price, up to $8,000.
– It does not have to be repaid. (Last year, buyers got $7,500 tax credits for homes bought between April 9, 2008, and Jan. 1, 2009, but had to repay over 15 years, interest-free).
– Singles must earn less than $75,000 a year. Married couples can qualify with joint annual incomes up to $150,000.
As a … (3 comments)
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real estate tax tips: Have you told Clients and Prospects about the 41 Tax Deductions they're entitled to? - 02/23/09 05:19 PM
With the current uncertainties in our economic environment, and even tougher times possibly ahead of us, your investor prospects and clients are in a position where they are looking for more ways to save and hold on to every penny they have.
Did you know that there are 41 different expenses that a rental property owner can write-off to put more money in their pocket this tax season?
Don’t let your clients pay more than they need to!
If your investor prospects or clients don’t know about these 41 different expenses they can write-off, they are definitely paying more … (5 comments)
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real estate tax tips: Stimulating Sales - One Solution to the Slow Down - 10/02/08 06:48 PM
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real estate tax tips: Help the Sellers, Help Yourself - Cultivating Business for the Long Term - 09/26/08 02:48 PM
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real estate tax tips: How to Write-Off Expenses when Traveling Away from Home - 08/21/08 03:44 PM
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Niman Singh
Fremont,
CA
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TReXGlobal
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