All Forum Posts by: George Eliot

Hi everyone,

I was recently gifted a house that I am currently living in but would like to move out of and rent in the very near future. The house needs some major repairs - pool, possible extermination of pests, etc. According to Every Landlord's Tax Deduction Guide the IRS will consider me a business owner if I actively manage the property. So, before moving out of the house, can I get the repairs done and then deduct them as start up expenses? Or do I first need to move out to be able to deduct them as start up expenses? Or, would I not be considered a business owner, in which case I couldn't deduct start up expenses at all?

Thank you!

Jon Holdman Could I not be considered a business owner and thus deduct repairs on the house prior to its being rented out as start up expenses? According to Every Landlord's Tax Deduction Guide, the fact that I'll be actively managing the property and using it to generate most of my income support my being considered a business owner. So does this mean I can deduct 5k before putting the house up for rent, and then deduct further repairs after the house is "ready and available" (i.e. after I have moved out) for rent?

Kyle J. and Steve Babiak -- Thanks for the advice. So, I have to move out of the house, change my address on my DL and establish residency somewhere else before I can consider the place "ready to rent"? The best strategy then would be to move out first and then do the repairs. Is that right? Thanks again.

Jon Holdman My CPA just told me to run an ad in the PennySaver before having the work done... She knows I'm living here. Should I hire another CPA? :P

Thanks for the help. :)

Kyle J. I'm not sure that they are "major" repairs. They're nothing that makes the place inhabitable. However, yes, I am living here currently. So I would need to move out before doing repairs in order to deduct them? Thank you!

Also, does the fact that I'm staying at the property while the repairs are being made affect its availability as a rental?

Hi everyone,

I own a house that I plan on renting after I make some major repairs. Is a CL ad sufficient proof of intent for the IRS, or should I run a print ad before starting repairs?

Thank you!

Bill Gulley The insurance company I've been working with keeps insisting that it's impossible to buy insurance after the deed has been submitted. Is this true?

Bill Gulley, Steve Babiak, K. Marie Poe and anyone else who can help:

I submitted the notarized grant deed and other needed documents (PCOR, certificate of trust, etc) to the title insurance company and they pointed out that the title record is clean except for a line of credit my father had taken out in '05 but never used. My father is closing this line of credit tomorrow, but the problem is that the title insurance company says the reconveyance will only be issued in two weeks to two months.

I need to have the house transferred as soon as possible because the pool is in major need of immediate repairs and I would like these to be done in my name so that I can deduct them (since I'll be renting out the house ASAP as soon as I make these repairs). This work on the pool needs to be done in about two weeks.

My question is, since I know the title record is clean (they sent a copy to me), how much of a risk would I be taking recording the deed without getting insurance at this point? The other problem will be getting back the notarized grant deed from the insurance company, because, understandably, they want me to record the deed with insurance. I will need to get those documents back from them in order to record the deed myself.

Any advice you can offer would be GREATLY appreciated, and thank you again for your help so far. It has been invaluable.

Bill Gulley I see, so there's nothing to look out for or worry about as far as finding a reputable title company goes? Just want to make sure since I'm doing this myself, that I do it right. :)