All Forum Posts by: Daniel McNulty

@Tarun Bansal

I have seen it done before quite a few times. The biggest problem arises if that concentrated position moves down notably. Your collateral in the concentration position would be less and can cause the loan to be called in part to shore up the LTV.

If you only borrow a modest amount against the line or are willing to hedge the concentrated position, it can be done successfully.

I do want to clarify that passive losses passed through the syndication will NOT offset capital gains. They are entirely different, so you would need a more thoughtful approach to address capital gains such as an installment sale, deferred sales trust or an opportunity zone.

@Chris Parker

The primary reason you shouldn’t buy 100 sfhs is it could be a giant pain and would end up being a full time job. Even with a Mgmt company and a trusted team, you will most likely spend a lot of time managing your team.

That being said you would be your own boss and you may find the work more rewarding.

There’s only one way to find out though.... good luck and congrats on your success thus far.

@Kev Cooper

A Qualified Personal Residence Trust (QPRT) is your best bet from a legal structuring standpoint. It would depend on the size of the estate how exactly it should be setup though.

Alternatively, just buy a lot more malpractice insurance and cross your fingers nothing too crazy happens.

@Andrew Pettit

Another clarification, Roth’s are not taxed when pulled out by you or by your heirs, assuming you are above 59.5 and the account is 5 years old.

@Kevin Tyra

If you can’t find other properties to 1031, installment sales can help lower that tax bill.

It gives you the control of the tax bill and you can roll the proceeds into any thing you want, not just real estate.

OZs can be great too but may require an equally large amount of capital.

@Benjamin A Ersing

A down payment is different than an expense, so purchasing another property by itself would not offset income.

However the 2nd property very well could have depreciation or other expenses to offset income from the first property.

@Maia Garcia

I have never heard of them, but it is very unusual for the attorney to ask for a gift deed. What exactly is he asking you to gift to him? Is he asking you to gift him something in lieu of paying for his services for cash? If so, that sounds real fishy...

There is nothing complicated about setting up a Series LLC, as I have done it in the past. It certainly never required a gift deed to our legal team.

@Lisa Jones

Lots to unpack here with the limited info you gave.

You likely will need a CPA to help calculate your potential tax bill and your options moving forward.

Financial planning can be useful quantify your goals and build a strategy to get from A to B, but it’s only as good as the info available to build it.

There are however tons of avenues to go passive outside of direct real estate ownership, starting with real estate syndications. It’s a different skill set, but is a pretty common place to start.

@Izaiah Jacobson

Your question may be to broad to start.

What are you hoping to achieve and why?

There are an unlimited number of ways to invest and everyone has their own preference. Similarly you may receive an unlimited number of answers to the question posed, which is not particularly helpful.

@Shon Ben-Kely

You might consider an opportunity zone investment equal to the cap gains created. Assuming you have the additional dry powder to make another investment, it may be your only hope to make the tax event less painful.