All Forum Posts by: Account Closed

Hey everyone. I currently own one investment property. I read BP's tax strategies book and did my bookkeeping for the year so I'm pretty familiar about tax strategies for investment properties.

I'm currently splitting rent with a friend at a cheap apartment. This made me realize I'm okay living with roommates which gave me the idea for my next property - I want to buy a property as owner-occupied, live in the basement (or cheapest room/unit), and rent out the rest. My goal would be to bring in enough rental income to offset the expenses so that I can reduce my housing expenses as close to zero as possible.

I've seen some scattered info on the web that deducting taxes from owner-occupied rentals is a bit different (square footage versus # bedrooms rented out versus pro-rata, etc). This got me thinking that before I go analyzing deals, I'd like to know if someone can point me in the right direction. 

I am looking for resources about tax strategies/write-offs/deductions that I should be taking advantage of so that I can better analyze deals on the market. Are there any books covering this?

In addition, I hear that there are provisions that supposedly disallow turning your owner-occupied home into a rental. But what if I stay living there? If I move into my new home and it becomes my primary residence, am I allowed to immediately start renting out bedrooms? Or do I have to wait some time? Note: I'm not talking about briefly moving in, getting the lower interest rate, then moving out. 

FYI, I'm in Illinois in case it makes a difference. Thanks in advance.

EDIT:

Quick scenario: 5 bedroom single family house. I move in and rent out 4 bedrooms and live in the 5th. Where do I start with calculating tax deductions on this?

@Nicholas Aiola My sister and I refinanced a house that used to belong to our deceased father in order to put the loan into our names. We have split ownership of the property. We have three renters and it is an investment property since neither of us occupy the building anymore. We took in rent all year, however, the house wasn't refinanced until February 2019.

I live in the same state as the property but my sister lives in a different state. What is your recommendation with regards to filing taxes for 2019? How do we split the rental income/expenses? What kind of CPA or other specialist would you recommend we speak to? This is our only property currently.