All Forum Posts by: Natalie Kolodij

Oh boy. 

Welp. 

I'm going to quote thumper on this one "if you can't say something nice, don't say nothing at all". 

I would just reach out to @Michael Plaks above to see if he is accepting clients. 

Unfortunately a lot of CPA's don't know how to handle short-term rentals correctly, at all. I'm confident Michael does though. I'd start there since he was kind enough to respond earlier. 

 Nope. There are pretty set rules around what qualifies and w2 doesn't unfortunaely regardless of how long you've done it. 

I wuold recommend using @Linda Weygant for this. 

She works with a ton of investors who house-hack and is nothing short of an expert on the topic. I beleive she's actually accepting new clients right now too which is kind of rare. 

For every 5 CPA's retiring right now, only one new one has entered the industry. 

In 2014 70% of currently practicing CPA's were set to retire in the next 10 years (we're there)

My friend is a university professor in IT (but his family business is a tax firm where he's worked his whole life) he was telling me how in the past two years their school has had 0 students sit for the CPA exam. 

Any how- so just to add to whatv everyone above said. Any one who's great at their job...but sitting around without a full workload during their busy season, in any industry...should be a red flag. 

I just wanted to add a little more context to the why. Plus we had a tonnnnn of tax law changes the past 3 years during covid which wasn't normal at all, the IRS is barely operational, notices, ppp laosn, stimulus checks, ect- I know a ton of folks who just retired or sold  in the past couple years too. 

Something being in an LLC doesn't make it a business asset.

It being rented for a business/profit motive does. 

Your personal home being in an LLC would not make any of your personal expenses now deductible. Your repairs would still be non deductible. Any renovations you do on your primary are not deductible but can be tracked for when you sell (they increase your basis in the property) 

Your personal mortgage interest and taxes are potentially deductible on Schedule A if you itemize. 

Putting your rental in an LLC may potntially cause you to lose lower property taxs with your county, cause lending issues and more.

Great post Michael. 

A Tax Strategist and a CPA are absolutely not the same. 

Many CPA's don't even work in tax, some do, and some are amazing- but even then many don't know REI.

I received this message on IG 9 minutes ago 

"My CPA said since my w-2 income is above $150k I cannot deduct my air bnb activity losses. Is there a spcific code section I can send him to show otherwise". 

Linda who commented above is REI specialized and I would recommend reaching out to.

That has been one of my thought points related to the additional flexibility on non-residential proeprty for depreciation. So this could be another point to be mindful of with regard to planning and how the buildinga s a whole will be classified. 

 I don't beleive we get to partition the building for depreciable life based on this wording :

• Residential rental property. This class includes any real property that is a rental building or structure (including a mobile home) for which 80% or more of the gross rental income for the tax year is from dwelling units. It doesn’t include a unit in a hotel, motel, inn, or other establishment where more than half of the units are used on a transient basis. If you live in any part of the building or structure, the gross rental income includes the fair rental value of the part you live in.
  
  
• It leads me to belive it is determination for the building. Otherwise if we could bifurcate the use this depreciation guideline woudln't exist. 

I was thinking we could separate it too - but especially after speaking w/ Kelly who was the IRS 469 tech advisor he said nope it's always used at as an asset determination for purposes of depreciation. 

The difference between the wording in 469  related to activity vs. structure for depreciation

I don't have a referral in TX specifically. 

But all of the Real Estate specialized firms I know work with clients virtually, + TX doesn't have state taxes so there's no local knowledge of state laws needed.

Does it have the ability to: Yes. 

Will it be the most tax efficent: Not likely.