All Forum Posts by: Scott McMillan

There is a boarded up house on the corner of Manatuck and Montauk.  Might be a good place to start, a yellow letter, or trying to find who the owner is.

Hey Matt!  If you are interested in a local investors group check out LIREIA.  Meeting's are monthly in Melville.

Thanks @Ned Carey, drifting slightly off topic here, but do you know if there is any requirement to form the LLC in the state you live in? I live in one of the states that is quite expensive to form an LLC in, NY. I will hopefully be moving to CA within the next two years and hear it is $800 a year there. I would prefer not to waste my profits on an expensive LLC here if it is not necessary.

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@Account Closed I see you mentioned adding "properties" to it. Are you holding multiple properties within one LLC or forming a new one for each property?

I have policies with agents located in the same state as the properties are.  Yes, my one umbrella covers both properties.  Typically as long as all of the properties are with the same insurance company it is ok.

That being said, paying taxes isn't necessarily a bad thing, it means you are making money!

If you were to pay any taxes they would be added onto your personal income taxes.  If you have any profit at the end of the year it is reported on Schedule E form on 1040 tax return.  As I said before on my first rental I have yet to show a "gain" for tax purposes thanks to the depreciation. Personally I handle all my own taxes, but as I add properties I will seek professional help.

Well first off I think you could do better with the property management fee; in the 2 areas I have worked in 7% was standard, placement fee was 1/2 first month's rent.  I would think your insurance would be a bit less too.

Secondly depreciation starts as soon as you rent it out, so if that is in November it will be 2/12's of a standard years worth of depreciation.  Depreciation is on the improvements, not on the land.  Your tax bill hopefully shows the land value, so subtract that from your purchase price and then add in your non prepaid closing costs.  

Here is a good link for depreciation...

https://www.therealestatecpa.com/2016/05/19/rental...

If you are going to be cash flow positive I do not know why you wouldn't want to rent it out and then look for a new place to buy eventually even if you have to rent for a year in the meantime.

I'm not quite sure where the extra $115 for taxes comes from.  Depending on how much profit you expect, depreciation would most likely wipe away the gain there and you may not have any taxes on it.  My first property is technically a loss that I deduct from my taxes every year.

@Nicholas Salvia Most investors are buying homes for the cash flow not necessarily the price appreciation.  During the last down turn prices went down but so did my assessments so my cash flow actually improved.  I held on to it and now it is worth more than I originally purchased it for.  I'm in the NY LI area, happy hunting!

I have State Farm and have 2 properties in different states.  Each property is with an agent in each state but just 1 umbrella.