All Forum Posts by: Bill B.

This seems like the very best possible solution to fight NIMBYism right? The alternative is people jammed in concrete jungles telling people who live the green lifestyle.  (The one city people say is the goal.) Their land should be used to power the city lifestyle.

The aaltenative is. Let’s have a vote with 2 million city folk and 200k country folk about where all the wind and solar plants that power city folk’s lifestyle should be placed. 

Oh look. 90% of the people say put in the county folk’s backyard because they don’t want it in their backyard. 

House hacking is easier than STR and in your example loses less money. Although MTR through furnished finder (dunno if Zillow is appropriate place to advertise) looks like it might only be $500/mo negative, less if they pay utilities.

You are cashflow negative $5k - $6k/yr but you’re paying off more than $6k on the mortage even month 1. (More and more each year.)So you’re turning a profit and producing a tax deduction with depreciation worth at least a $10,000 deduction saving you $2-4k depending on your tax rate. So while it’s cashflow negative it actually produces a tax free profit. 

As Stephen hinted at. The downside is because it was a rental first, you will never get a 100% tax free sale. The depreciation recapture will be 100% taxable, the capital gain will be prorated. (After you hold it a minimum 5 years a pro-rated portion of the gain can be used towards the sec 121 gain.) As long as that wasn’t your intent when you bought it. 

As Stephen hinted at. The downside is because it was a rental first, you will never get a 100% tax free sale. The depreciation recapture will be 100% taxable, the capital gain will be prorated. (After you hold it a minimum 5 years a pro-rated portion of the gain can be used towards the sec 121 gain.) As long as that wasn’t your intent when you bought it. 

I believe most MHP owners would tell you to sell of the homes asap and switch to simple lot leases. Eliminate maintenance and insurance costs while almost guaranteeing long term tenants. 

Don’t forget your screwing your self for the next 29 years with lower deductions if you take them all year 1. You’re not creating deductions out of thin air. You’re simply taking them today instead of in the future. While there is the argument that money saved today is worth more than money saved in the future. Much if not most of your deductions if taken all in one year will be against lower tax rates than if you took some each year. (As a married couple. Deductions on income  over $206k saves you 24%, $96k-$206k saves you 22%, but any further deductions only save you 12% or less.) 12% tax savings this year isn’t much of a deal compared to 22-24% off next year. Plus. If you ever sell without a 1031 you’re stuck paying depreciation recapture up to 25%.

@Joshua Garcia. Sorry, that’s what I meant. If the price/work done seems reasonable, not that they did it. 

Yes. The PM should have either stopped the work or reiterated they weren’t paying. It wasn’t really unethical of PM as they are making the same or less than if they did the work, just sloppy/bad execution.  

Yes, MOST people take before and after pix now even on tiny jobs. I also assume the invoice will say what was done. You could just show that to other plumbers. In regards to proof of leak I was hoping the gas company guy would have a report saying. Gas leak detected, gas main turned off. Not just gas main turned off per request. 

Advertise with 2 weeks left. Show if the tenant is cooperative and the property is in good condition. Otherwise list with previous move in pix and available 2-7 days after lease end. Depending on last inspection. 

I’ve had turns as little as a week but 2-3 is the most common length outside of disaster areas.  

Find out if repair is/was reasonable. If so, no problem, tenant saved you hassle. 

If not. Figure out why the PM did NOTHING for 3 days after being notified of a gas leak. All they had to do was send someone out to look at the problem and they would have noticed someone working on it. We usually fix “stupid” stuff the same day, we certainly would have had someone look at a gas leak the same day. 

Lastly, if the price is unreasonable talk to the plumber see of there’s any compromise. Show them them multiple quotes that are at least 25% less. (Or don’t bother.) Then ask them if the tenant told them they were the owner or a tenant. ZERO companies should start any job, much less a major job without the owner’s signature/approval. They can argue this but what if the bill was $13k, or $23k? You didn’t agree to pay $1. Maybe the tenant did and they could be forced to pay?

Anyway. Hopefully you find out the quote is/was semi-reasonable so that problem goes away. Then you just have a PM problem. 3 days with no action on a home with either a gas leak or no gas? Not too good. 

Ps. Can you get confirmation from gas company they detected a leak? Hate to think there was never a leak and the guy was just giving his friend a good gig. 

I missed the part about a family transfer. 

If this is a gift, or you are paying way less than it’s worth. Make sure your father in law declares the gift and/or pays his share of the taxes. (The IRS is wary of tax burden shifting.) You will also inherit a very low cost basis (his actual cost basis which could be insanely low, or your artificially low value if you’re lucky.) making any eventual sale a tax landmine. This is the kind of transfer that’s usually done at time of death to avoid all the taxes. Just keep that way smarter than me CPA involved BEFORE you do any transfer, they SHOULD have an idea of the impact on each of you.