How long to hold before selling at a loss

7 Replies

My 2 member LLC purchased a house in Oct 2016. We rented for 3 months in 2016. We rented for 4 months in 2017.

We would like to sell as soon as it make the best tax sense.  We know it will sell at a loss. How long should we hold before selling?

Also - do we have to continue renting it or can we keep it vacant until we sell?

@Michelle Eng

If it is losing money why hold on to it? sounds like it is already LT gains over a year on the rental market.  See if trump taxes may affect you but I say carrying costs are probably hurting you worse than any potential tax savings.  Not sure because I don't have all your personal circumstances but top level says get rid of it.

@Michelle Eng Since the house was purchased in Oct 2016 and was always a rental property (unlike housed converted from personal residence and flips) there should be no issue claiming and proving (if needed) that it was always a rental property. With that being said, there is no time frame you should be holding it before you can sell. 

And you don't have to continue renting it until you sell, the property can be vacant. 

If it is a vacant SFH losing money sell it yesterday.

You need one year for Long term capital gain treatment 

Why not approach your tenant first?  Tell your tenant that you are planning 5o sell the property and you are giving the tenant the first opportunity to buy before you pyt it on the market.  If you are losing money each month with a tenant in8 place, how much more will you be losing if you vacate the property first.

If your tenant is on month to month, then leave the tenant in place so you at least have some income to offest your expenses.  When you get a ratified contract, give your tenant 30 days notice, unless the buyer is an investor who is willing to keep the tenant.  If the tenant is on a long term lease, most states require the buyer to honor the tenant's lease.

You are all crazy

THEY DO NOT MAKE MORE DIRT!!!

SO DS

Its a loss at 12%

Tax 13%

INCOME OF -

your brain

ENJOY

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