All Forum Posts by: Jimmy Chim

@Steven Hamilton

Thanks for your response, Steven. That is very helpful. I do want to follow up if that's alright. Let's say for tax purposes, I'm renting out 30% of my home. My understanding is that under this situation I will depreciate 30% of the building basis over 27.5 years and deduct 30% of the expenses (utilities/repair expense etc that would otherwise be non-deductible if I'm not renting out) in schedule E.

My question is: What happens when I sell the house at some point in the future after I met the 2 out of 5 year rule and realize a capital gain? Is my capital tax exclusion going to be only $250*70% = $175k? How would I be taxed for portion that I depreciated (depreciation recapture)?

Any insight would be helpful. THanks!

Thanks for all the kind words folks!

Jay Dao Are you primarily looking at turnkey properties? What states are you potentially looking at?

I'm a newbie so I still need a little/experience before I'm ready to go out of the area. Obviously the rental yield in the Bay Area is not very attractive given all the costs and tenant-friendly law that make management more challenging.

Minh L. Thanks. Any advice starting out? Do you mostly invest in local areas?

Glad that I discovered BP a while ago and I have been a regular patron since then. Been listening to BP podcast during commute this month and find it very informative. So keep up the good work guys!

For work and multiple other reasons, I bought a single family home (my first one) that requires TLC in a decent neighborhood and planned to fix it up a little and live in it and rent out other rooms to some of my friends to cover the expenses. I have a fulltime job and I was hoping that I will start it slow by learning how to manage a house, taking the time to assemble my team and learning about rehabbing/remodeling along the way. In a few year times I hope to flip the house.

At this point, I'm trying to get my hands on books and every resource I can find to learn about RE as much as possible. My goal is to get my first multifamily (2-4plex) within the next 12 months.

Excited about this new venture! Looking forward to building new relationships here.

I just bought a single family home. My intent was to live in it and rent out a couple of rooms and then sell the property in 2 years in order to take advantage of the $250k capital tax exemption. My understanding of the tax rule is I need to report the rental income and expenses on Form E for the portion of the house that is rented out. My questions are:

1. Does reporting rental income/expense on Form E have an impact on the capital tax $250k exemption if I rent the house out?
2. Can I depreciate the portion of the house that is rented out?

Thanks.