All Forum Posts by: Anna Watkins

@Johann Jells  -- or maybe we're the only ones more concerned with financial aid eligibility than with taxes??  :-) 

I have a whole collection of locks & keys that I install temporarily if work is to be done between tenants, so old tenants don't have access but workers don't have access to new keys.  I rekey (or re-lock) after all work is done and ready for the new tenant. That way, only they and I have access to the keys that work -- it's a security thing that I am sure to mention to all tenants when they move in.

From my research, it seems that an LLC is the way to go for small operators who'd otherwise go with "sole proprietor," and it's the way I'm headed. I'm hung up on a couple of aspects, and I thought I'd ask here before starting a new thread.

So my question is somewhat related to @Johann Jells  , since I too am concerned with money and assets used to calculate college financial aid.

I'm pretty smart but have zero business experience (as in keeping books, taxes, profits, etc). My goal for the next several years is to build a foundation for retirement, not to make any profits -- as in, no profits at all. I have 2 SFH rentals in metro Atlanta and hope to add one or two more in the next year or so. My kids are in private school, I'm a single parent with a decent but not amazing income, and we're looking at college in 2-3 years and I'm afraid of upsetting the financial aid apple cart that's making their current schools possible. How does one run a legitimate business, pay appropriate business taxes, and come out with a zero sum to report on my personal 1040 and somehow protect the properties from being considered assets to be sold for tuition? I did consult a CPA recently but conflicting information now makes me second-guess!

Thanks everyone!

I just closed on a SFH in SE inside-the-perimeter with a real estate agent who works with investors - Michelle Hollberg.  She's affiliated with the Harry Norman agency, owns a duplex herself and also owns a property management company with something like 120 units under management.  It was a good experience, though since I ended up buying the first house I looked at (sometimes it just happens that way) she didn't have to deal with me and a series of lowball offers and all that.  Now that I have more experience and know a WHOLE lot more (thanks BP!), I think working with Michelle would be even better since I'd know more when to push my agenda and when to listen to advice.  

I have a few goals for 2015, all fairly small and I hope achievable. 1) buy a property in Tennessee that I want for retirement (this is very specific, with an identified neglected property, an absentee owner and several years of unpaid taxes); 2) separate my business money from my personal money, at least with different bank accounts for rental properties, and at most by setting up an LLC for the rental business; 3) buy one more rental property in my chosen area, the Belvedere Park area of DeKalb County (Metro Atlanta), ideally from a wholesaler at less than MLS retail; and 4) invest $15/20K in another real estate deal in metro Atlanta, either as a hard money lender or a partner, perhaps in Atlanta's West End (lookin' at you, Rick Baggenstoss!)

@John A. Thanks, John, that's really good info. As a sole proprietor, do I have a separate tax ID number, or do I use my SSN? I keep planning to form an LLC for my rental business, but get hung up on decision making. Grr.

@Brandon Turner  -- I looked into Williampaid but reviews were mixed.  My tenant set up an account with Dwolla and was cool with it, but when he went to send the payment, he said it wanted him to put money in the Dwolla acct. first (and it was already payment-due day).  I guess I should try asking myself for money so I can see how it works first hand!

Guess it's a balance between ease and cost (just like everything else).   Does anybody use Chase Bank's QuickPay, or similar at Wells Fargo (I read about it in the Forums).  With adding a 2nd house, and hopefully another one next year, I need to open a separate account anyway.  A service that allows easy electronic rent payment would be a deal-maker.   Josh Dorkin or Brandon Turner, which one of you uses Chase?  Feedback?

Thanks!!!

@Derek B.   Thanks -- good point to consider. I think you're right.   A  'false alarm' fee responsibility is built into the lease (along with getting the toilet snaked out, etc).  The reason I'm providing the monitoring is that it's a new system, and the install fee requires a 12-month monitoring contract (so I increased the advertised rent by $25 month to cover it!).  The lease includes a clause stating that after 12 months the tenant can choose to pay for the monitoring contrct or to drop it.

I would like to use an electronic service to collect rent from my tenants, who are (so far) banked and fairly competent computer users.  Intuit's Payment Network is appealing and recommended in several BP posts, but I am not a registered business (I only own 2 rental units, both in my own name) and don't think I can legitimately apply for a receiver account. Or can I?

Those of you who use and recommend IPN, are you incorporated or LLC'd? Or are you a de facto business as a proprietorship and don't worry about it?

I was going to try Dwolla, but it requires the tenant to first put money into a Dwolla account and then transfer it to me, which takes many days and was more than I wanted to ask of my tenants. I just want some way for them to take money out of their bank account and put it into mine. Bam! What services do that without a lot of stops in the middle?? And can I use them without setting up an LLC (another post question entirely)?

Thanks!