All Forum Posts by: John West

@Caleb Stephens Good to have you on board! I have been investing for one year now. In that year I have aquired a SFH and a triplex a little north of your area. Maybe we'll get a chance to meet at a local REI group sometime.

Were the flips you did in Freeport? 

It went well. I had an inspector come in on a recommendation from my realtor. He did a VERY thorough job. He ended up revealing enough that we decided against the purchase. I have since purchased another building.

One suggestion is to call two or three management companies in the area. I did this with a property I purchased in Augusta. You’ll get a lot of good info through them. They can tell you right down to the street which areas to avoid, vs what parts of town are better. You’ll also get a good feel for the management company through this call. Don’t buy the property if you can’t find a PM enthusiastic about managing it.

Thanks @Tim McClary. I just contacted Justin via the email address on his website. We’ll see....

Matt Covert That is one of the most useful posts I’ve seen since joining BP. I’ve downloaded the .pdf and will read it soon. Thanks!

So I know two CPAs who do a great job. My only concern is that living in rural Maine, they can't easily specialize in one area and keep their doors open. Because of this they do just about everything a CPA can do. Listening to great accountants on the podcasts (like @Amanda Han), I am wondering if I need to find an accountant who specializes in real estate.

Right now my situation is pretty basic. I have an LLC with one partner. We split everything 50/50. We formed the LLC (because we have some assets we want protected) earlier this year and have since bought 2 properties - 1 SFH and 1 triplex. There aren't any complex transactions. It seems to me any accountant could do this. We basically have been paying a few expenses (mortgage, taxes, oil, startup fees...) and collecting rent. No major renovations. No home offices or anything fancy. I'll claim depreciation of course. What else is there?

Should I just use someone local that I know I can rely on or should I start searching for a CPA who specializes in RE?

Thanks everyone for the responses! We just signed papers and closed on the triplex earlier today. 

@Brett Sorenson Yes, everything is in the LLC's name, and we have split everything 50/50. My partner and I put exactly the same amount into an account to get started and we share responsibilities. I may put a little more time in, but that's because I really enjoy the work. What do you mean when you say we "need to have enough basis in the partnership"?

@Christopher Smith Our interests are 50/50. And yes, I am figuring the $5,000 loss will come from depreciation. Thanks for confirming!

@Lance Lvovsky Thank you. I am searching for a CPA now who will help me with this. 

Me and a partner formed an LLC earlier this year. We wanted to start investing in real estate and my partner has a few large assets he wants to protect. We split everything 50/50. We are closing on our second property (a triplex) next week and I’m curious about how we will split the tax benefit from paper losses this year. This is the first time we are filing taxes since having the LLC so we’re pretty green. I understand the basics - how the LLC isn’t a tax benefit and is just to protect our assets. The following article by Amanda Han was excellent and helped answer 90% of my questions. https://www.biggerpockets.com/renewsblog/2014/09/11/yes-you-can-write-off-your-depreciation-heres-how/ My only remaining question is this: If we show a 5,000 paper loss, will we each get to have 2,500 that we won’t have to pay taxes on? Is it that simple?

Thanks forte input everyone. I'll keep you updated if we come to an agreement.

I have a friend who is under an owner financing contract. Here is what I know for details on his contract: $12,000 option paid 2 years ago. $38,000 balloon payment due very soon. He can't get the financing and is considering walking away. Is there any way for me to take over his contract? I'm fairly confident the current owner wouldn't want it to happen, because let's face it, he'd like to pocket the 12k and sell it for 50 again. Is there any kind of a play that will let me pay the remaining $38k and give my friend a few thousand so he's not completely out all his cash? The house is worth 65 - 70.