All Forum Posts by: Andrew S.

Ok, I see - he is talking about a state and/or local service tax ("sales tax for services").  In my view, he should include that in whatever price he agrees to (i.e. in the $100 per property), but in any event, those types of taxes are usually in the single digits, NOT 25-30% as he seems to ask.  Although I'm not in Texas, my understanding is that the state portion of sales/service tax is 6.25% and then some municipalities slap another percent or two on top of that.

 Sounds like he is more of an emergency contact than a PM then.  If all he does is answer the phone for you then I actually think $300 is way too much, so make sure you know what you are getting from him.  I.e. is he going to charge you extra for his repair trips or are those included (at least the labor and basic supplies)?  What if it is something he can't handle himself? etc

 No sure I understand: he put a temporary patch on it last night?  Then why didn't he turn the water back on?  Isn't that the point of a patch?

Not sure what taxes he wants to be compensated for here.  Sounds like he wants you to cover his income tax?  That's not done "normally", but if you feel that is appropriate and agree to it, then there is nothing wrong with it.  $100 per property could be a good deal or  bad deal - typically PMs take a percentage of rent, so if these are very high rent properties, then $100 is cheap.  If they are $500/month properties, then its expensive.

Have you verified that that Texas law allows him to PM?  Most states require PMs to have a real estate license, so if that's the case in Texas, then make sure he has that license.

LOL!!!  Sounds like the conversation was deeply focused on real estate yesterday....  :-)

 Transfer it to a custodian that allows self-directed accounts.  I have an SD Roth with Equity Trust Company (one of the bigger custodians for SD IRAs), and they do indeed offer self-directed Coverdells.  Once transferred, you'll be able to do a very wide variety of transactions (including tax liens)

 Thanks for the correction, David!  I was not aware of this for Coverdells - I still believe 529 cannot be self-directed though.  The problem with Coverdells is the low yearly contribution limit.

As I recall, Cozy doesn't charge a fee as long as the tenant pays via their checking account. There is a fee for debit and credit cards though 

 That's interesting!  Is there a cap to this reimbursement?  If not, you can probably significantly lower the chances that the ex-owner can re-claim the property by doing a ton of rehab?  That seems to contradict the intent of the redeem rules?

 If you really mean $4000 a month return (i.e. near 50% return per year), you'll need extraordinary skills, or be willing to tolerate very high risk.