All Forum Posts by: Greg C.

I'm just going to note here again... I'm just learning and taking notes.  If I'm miss informed or not accurate in my info.  Feel free to let me know.

Here is a good link explaining the rules to claiming as a "Real Estate Professional" on your taxes.  It's dated 2014 by Tony Nitty, but I don't think the info has changed.  I of course would recommend a CPA but this is for my personal info...

Tax Geek Tuesday(?): The IRS Finally Figures Out The Real Estate Professional Rules

Some important points made here that are relevant if you are a single property investor vs a multiple property investor and how you need to do "grouping elections".

I'm taking note of the Real Estate Professional because it is a way to get around depreciation caps on personal earnings with passive income.  IE if say my wife qualifies as a Real Estate Professional.  $150,000 cap would not apply and passive income depreciation / losses would adjust our combined MAGI.

Bank Rate - "Taxpayers whose modified adjusted gross income, or MAGI, is less than $100,000 can claim up to $25,000 in rental losses. The $25,000 cap is reduced $1 for every $2 a taxpayer's MAGI exceeds $100,000. For example, a MAGI of $110,000 exceeds $100,000 by $10,000 so the $25,000 limit is reduced to $20,000. At $150,000, the reduction to the cap is the full $25,000, which is your situation. Any losses you can't claim are carried over to future years and allowed as a deduction against passive income, including gain on the sale of the property. If your income were to go below the thresholds, then you would also be able to claim the losses, including those carried over."

earnings-too-high-claim-passive-losses

Thanks @Samir Montenegro and @Account Closed

@Ben Leybovich Well now I have to listen to both of them.  I'll Probably listen to #61 first as as my mind is focused on Multifamily at the moment.

BP Podcast 061: How to Succeed in Multifamily Investing – A Unique Conversation with Josh, Brandon, and Ben

Should be noted that when I searched your name #61 doesn't show up in the Podcast section.

Yes Los Angeles traffic.  One of the great pleasures of living here.  Also the spectacular real estate deals for folks interest in Buy and Hold.  (that may be sarcasm)

@Ben Leybovich Thanks Ben.   I appreciated your point of view.  I'm going to listen to your other pod cast on the commute home tonight.  One good thing about a 1 hour, each way, 9 mile commute in LA is I can get in 2 Pod Casts a day.

BP Podcast 014 : Cash Flow, Creative Finance, and Life with Ben Leybovich

Podcast 150 With Clayton Morris

"What's your Freedom Number"  Great info here.  Something I will work on later today.

BP Podcast 152 - Ben Leybovich, Brian Burke, and Serge Shukhat

So much great info in this Podcast from 3 very different perspectives. Worth re-listening to.

Notably for me the idea of slapping "Lipstick on a ($30,000 SFH) Pig" really only yields you a $30,000 Pig and that even though you may have meet a 50% rule or 2% standard the long term costs of CapEx may far out way the cashflow. Think Fixed Cost for say... a roof. Also re-enforcing the idea that a "good" deal isn't speculative and relies on the value of the deal and the Value Add play.

@Shawn Ackerman

@Shawn Ackermanundefined

Thanks...Maybe it's safari but this always works weird for me

Helps me remember if I put it out into the world.

My wife started laughing hilariously when I ask what the tiny package from amazon was :-)

In looking for a farming ground...  not sure total relevance but found it interesting.

States with no income tax...

Alaska

Florida

Nevada

South Dakota

Texas

Washington

Wyoming

Limited Personal income tax states

Tennessee

New Hampshire

Podcast 190 - Pat Hiban

“On Section 8, I buy where if they find out that I’ll put a Section 8 in there, they’ll be upset.”

Vertical vs Horizontal streams of income 

Benefits to "Real Estate Professional" on taxes (research eligibility)

Podcast 183 - Sarah Pritchett

"Instead of accepting No ...ask How can I do this deal..."

Podcast 125 - Michael Gerber

"Learn from a Master" "Be a Master at what you do..." "Have a Dream..."