All Forum Posts by: Melody E Bergloff

@David Smith @Jason D. @Greg Dickerson @Bjorn Ahlblad 

There is no magic bullet answer per se to this question. However, given the amount of gain (i.e. $200K), the two best tax strategies would be to convert the property to a primary residence and/or working with with a tax professional that can help you maximize your deductions. 

If you are filing single, you have $250K capital gain exclusion for selling your primary residence. Also, there are probably deductions you may be missing (i.e. depreciation).  

@Morgan Gruelle

I recommend to my clients to use a credit card or check to create a paper trail. However, you can also use a cash receipt notebook to create a receipt. 

The best way that I found for small business owners to track their income and expenses (whether its cash, check or credit card) is to leverage Quickbooks or a similar program. I would reach out to a tax professional and/or bookkeeper if this is unfamiliar territory for you.  

@Sarah G. @Todd Rasmussen @Jacob Sampson

I generally agree with everyone that for tax purposes, you dont need it yet. I would set up separate business accounts to track that income and expenses separately. 

As far as for legal reasons, I am going to defer that to a legal professional. The LLC does provide that asset protection as everyone has mentioned, but I cannot advise one way or another on that aspect.

@Jenifer Levini

You can also post an add on the Market Place forum. There are a few tax professionals on BP that can probably help you as well. 

@Nashid Ali @Gaurav Mehta

I like this map and have used this link as a reference point. I would still cross check the data with the links provided at the bottom to each state's website to verify the accuracy. 

@Eamonn McElroy

Thanks for the reminder :) I think I mentioned this in the first post that there are several people on BP that would be able to help. 

@Natalie Kolodij 

An Enrolled Agent (EA) is another credential similar to a CPA. My point is that people should work with an accountant who is credentialed, educated and has the experience. 

I have acquired so many clients that did not use a licensed tax professional, and it has been a disaster for them. How do you practice before the IRS without a credential? Just a thought. 

@Pat Jackson

I agree with Bob that you should definitely consult with a CPA. There are probably other tax implications that you may not have considered (i.e. state and local tax issues). Some states will conform with the new OZ rules while others wont. 

@NIcholas Hamel

Quickbooks can help with your bookkeeping needs. 

@Mike M.

I am not sure what your approach in using a SDIRA to invest in real estate will be, but there are ways you can continually invest in real estate using retirement funds. 

Have you consulted with a CPA yet? There are a lot of tax "landmines" in using a SDIRA for real estate investing, so be careful whom you work with.