All Forum Posts by: Brad Hammond

I think the work of selling the property should be compensated separately from the deal itself.  I think that negotiating a lower commission from the agent would be fair for everyone though.

From the plumbers I've talked with about it, it isn't worth the money to add another water meter.  You might be better off just billing the tenants for the water.  

Hey @Dalton Cody, you can use a hard money lender, a HELOC loan, or refinance it, and again once you are done with the rehab. A HELOC is going to be the easiest and cheapest option.

Hey @Austin Cooper, good question.  it depends on your level of risk.  I would recommend a low-cost brokerage fund that follows the S&P 500.  Just know you could lose money if the market tanks between now and then.  If you are looking for something safer, you could put the funds into a CD account at your bank.  That is very safe with low interest.  If you want something in the middle, maybe you could do half & half or 75%/25%.  

Hey @Lexie Greenheck, your sitution should be straight forward for most CPAs out there.  I would ask them if they have experience in real estate investing as well as your specific niche.  Beyond that, I would ask them how they can help you with tax strategies.  Not necessarily specific examples but if that is something they can help you with in general.  In my experience, CPAs will fill in the boxes and it is up to you to ask questions on how to best take advantage of tax incentives.  Having a CPA that will make sure you are taking advantage of everything you can is huge. 

Hi @Carol Burns, if your goal is to make higher cash on cash return, then you should sell and reinvest that money.  Since you will re-leverage your money, you should be able to get a better return on your money that way.  I would analyze some properties that you could afford if you did a 1031 and if you had to pay taxes on that money.  See if the returns you would be getting are closer to what you are looking for or not.  

Hi @Kaitlin Neary, I have some thoughts for you but I might be making things worse for you.  so hopefully someone else can chime in here as well.  

1. Bonus depreciation or accelerated depreciation increases the depreciation schedule for the first few years.  You will need to hire a professional to help you with this since it is a very complex system.  

2. While you will have the depreciation, you most likely won't be able to use the losses against your W2 income since you make over the threshold (I thought it was $150k).  

3. Bonus depreciation is usually done on larger apartment buildings since there is a lot more to depreciate compared to a single-family home.  I'm assuming your short term rental is a single family home or smaller.

4. In my personal experience, my short term rental income was taxed as earned income at around 30% since it is more active vs. passive.  

Hey @Jennifer Manzella Savva, congrats on your success! If your question is if you should open an LLC, I think you might be asking the wrong professional. The benefits of an LLC are more on the legal side than on the tax savings side. In fact, an LLC will likely cost you more in taxes due to the annual fees. Let us know if you have other tax questions and I'm sure BPers can help you out.

The biggest takeaway from taxes from my short term rental is that the income is taxed as earned income.  This means it is going to be taxed closer to 30% if not more.  

Hey @Alexis R Beckley, welcome to the club!!  KW has lots of great information that you should take full advantage of.  Beyond that, take a look at your local Facebook groups for agents.  They have lots of good information.  If you are into podcasts, check out Tom Ferry for experienced agents and Agent Rise for new agents.  

Hi @Kiran K., from what I've heard they tend to hit you with fees at the end of the transaction.  That is just the gossip on the street that I've heard though.