All Forum Posts by: Adam Rasmussen

Sounds deductible to me. Ownership timing is irrelevant in this instance. 

It really depends on how much you make at your W-2 job. You are able to fully offset up to $25k of your income as long as your income isn't over $100k. Once you go over that amount, your deduction is reduced $.50 for every dollar over the limit until you hit $150k where all losses are disallowed  in the current year and carried forward. 

I have not listened to the podcast episode yet but you are correct. If you are a high income earner you are not allowed to take passive losses against earned income. Being a true real estate professional is tough to prove when you have W2 earnings, as well. 

Unless I am missing something as well, it doesn't sound right.

As the names suggest, secured credit is backed by assets (mortgage collateralized by house) and unsecured credit is not backed by anything (credit cards). 

Hi Karl. Might need some more info on what exactly the issue is. Are you concerned what to classify your personal deposits as in your accounting software? I am not familiar with Waveapps but I can only imagine they have a classification for "owner contributions" which would show an increase in cash (asset) and an equal increase in your equity in the LLC.

I am at the point where I would like to start analyzing multiple deals a day in order to get some reps in. I am not at the point where I can justify spending a monthly expense for the BP Pro.

Does anyone have a favorite free calculator? 

Very good question. You might do some independent research on some specific topics and then quiz some of your prospects to see how they handle them. 

I had a client find me through a random internet search and was asking about 179 deduction and 121 exclusion and afterwards was upfront and told me he was quizzing me. Thought it was a pretty good tactic to see how savvy people are in a quick call. 

A question I might ask is how can a CPA pay for themselves with a real estate investor? That is a good question to find out if they know specifics about real estate but also an actual question you would probably like answered! Maybe a better way to phrase it is how can they provide value to a real estate investor. 

Matching the interest deduction with the property is the way to go. Meaning you will be filling out Form 8825 for each property and will be putting the interest deduction that matches with that property. 

@Ben Kirchner I am very biased but I believe a CPA should be able to pay for themselves. If you are used to TurboTax you may get some sticker shock but a perfectly reasonable question to ask your CPA is "where did we save in taxes?" The answer should come out to that the tax savings are more than what the fees are for the CPA. 

With new clients I typically like to be up front with those kinds of things. Especially those that are transitioning from the self-prepared services to a professional.

Another good thing about a CPA is having someone on your side to bounce ideas off of. The value is in the tax return so that is where our price is high but the questions throughout the year are not billed. I actually enjoy those conversations with real estate clients, to be honest. 

I have started that book myself and before reading I was confident I wasn't going to find much value but I am a few chapters in and am learning a bit. Not so much about the law but the approach to the law for the most part. Looking forward to finishing the book as well as checking out the updated version. 

Good luck!

It is pretty hard nowadays for CPAs to be shady with the internet and how info is shared. I would assume the same is for attorneys. 

With CPAs you can even lookup if they actually have their CPA license.