All Forum Posts by: Josh Bauerle

 That’s not how the 20 percent deduction in the new plan works. It reduces your taxable profits by 20 percent, and the remaining profits are taxed at your ordinary rate. 

There's also no difference between owning them personally or in an LLC, you would get the 20 percent deduction either way.

 Your sale proceeds minus all costs, including purchase price, renovations, selling fees, etc are tax at your ordinary tax rates. 

It’s not treated differently than any other forms of income. 

 Well said. 

As a CPA I’m so tired of these non-tax experts who have a huge following giving out worthless tax advice. And then when the client asks us about it they think we are just being too conservative and/or don’t know what we are talking about. 

Ryan Moran is the big one I keep getting hit with right now. If I have one more Client ask me if they should set up their small business as ten different C Corps to reduce the taxable profits in each I am going to scream!

To echo the thoughts here, no you can’t just set up random rental arrangements to get around the property tax limitations. On top of needing a profitable business to deduct it against you could also run into the related party rental limitations. 

Honestly if you are paying $30k a year in personal property taxes you make way too much money to worry about these type of strategies. 

@Joe Splitrock No, I actually don't need to pay it off and it most certainly isn't reckless.

From a wealth building standpoint, depending on the interest rate you are paying, I would consider it more "reckless" to pay it off and not do something that generates FAR better return than the 3 percent interest I'm paying on the loan.  Now I totally get people wanting to pay it off for peace of mind, etc.  But simply by the numbers there are much better things to do with your money.

I simply cannot possibly disagree more that student loan debt is worse than credit card debt simply because it is secured.  CC debt is likely 15+ interest rate.  I could not care less whether my student loan debt is secured or unsecured.  I have well over the assets to cover it and if everything came tumbling down I'm not too worried about them coming to make me pay my student loan payments.  I will have far bigger problems at that point.

Thanks guys. Great suggestions. 

Signed up for Cozy.  I’m still a little concerned how effective that option will be in my area, but it’s worth a shot!

 If he can’t afford the property and potential vacancies, repairs, etc that’s a completely different story. But having student loan debt has nothing to do with that. 

If he were talking about credit card debt then I might agree. But student loan debt doesn’t need to be aggressively paid off. 

I make a very high income and have plenty of cash and cash equalivents and I carry over $30k in student loan debt. Why?  Because it’s very low interest and I can do more with the money I would use to pay it off, like invest in real estate. 

If he can afford the investment, including the potential risks, the student loan debt should play no part at all in his decision. 

 I don’t understand, how does student loan debt make investing in real estate any more or less risky?

Thanks Jordan, Cozy seems really interesting!

I do wonder how well payments through it would work with most of the renters being low income?

Any idea what a real estate agent would charge for a commission on getting tenants in?  That idea might work well since the real estate sales market in my area is really down and it could be a good way for younger agents especially to bring in some money. 

Thanks for the ideas!

I’m in the process of purchasing 13 total rental units to go with the two I already own.  This is in rural OH and there are truly no good property management options. 

I’m trying to think of ideas to outsource several of the landlording tasks without a true property manager.  Any ideas on tasks like...

Finding tenants- This seems to be the biggest time consumer and toughest to outsource. I’ve thought about finding someone who could simply handle showing the property and screening potential tenants and just get a 50 percent commission on first months rent for successfully placing a tenant. Any other ideas there?  Maybe electric lockboxes that would allow people seeing the properties to look themselves?

Collecting rent- Obviously they can mail the rent, but that still requires trips to the post office and bank and when people don’t mail it I will still have to go knock on doors. Anything I’m overlooking there?  Any good ways to offer them to pay rent remotely?  Most of the units are lower income type properties so several people won’t even have bank accounts. 

Repairs- I don’t see any other solutions here than having a bunch of handy men I can call with repair requests. Any ideas I’m overlooking?

Anything else I can do to reduce my day to day activities in the properties without a full property manager?