All Forum Posts by: Spencer Karr

Spencer Karr has started 0 posts and replied 9 times.

Originally posted by @Jack Clough:

I have an LLC for consulting work. Company A pays me $100k to consult. Currently this income would be added to any other income I have and I would be taxed at the rate that it puts me in (say 35%). So I take home 65k. The new tax bill would mean all that income would be taxed at 21%. I take home 79k. No double taxation at all. Make sense?

@Christian Hutchinson

SALT stands for state and local tax. People can DEDUCT their state and local taxes when they file. So if you live in Jersey for example then you're able to deduct a LOT more than if you live in a state like Florida that has 0% state income tax. So, basically the federal government is encouraging states to raise their taxes and rewarding the people in the states with a handout.

With this tax bill, taking away or capping the SALT deduction will level the playing field for all the lower income tax states. More importantly it will force the high income tax states to lower their taxes.

This country was built on state sovereignty. The best way for it to work is to allow states to compete and if they're going to compete then the feds have to treat them equally. If Jersey wants to have higher taxes than PA or Delaware then fine, that is their right. But the feds shouldn't subsidize that behavior.

Your are correct my friend. You are talking about your LLC which is a pass through entity. I saw a couple of mentions about the corporate tax rate not the pass through which you refer to here. I wanted to make it clear that corporate tax rate cuts still doesn't make sense for small businesses to convert to using C Corporations in most situations because it will still be subject to double taxation since C Corporations are taxable entities.

0 Votes

@Patrick M touched on this. Let me make it clear. The corporate tax rate dropping to 21% likely won’t help any of us because if you want to take any money out of that corporation, it will be taxed again at your individual rate of probably at least 20%. This is double taxation and the reason none of us should ever have a corporation unless you plan to take it public or create a REIT which can always be done later. An S Corporation is a pass through entity and would be treated basically the same as a partnership. That can be confusing sometimes because it has corporation in the name. P.S. I haven’t been able to figure out how to tag people in the app.

0 Votes

Stay away from Las Vegas small multi family!! All of them are in rough D class neighborhoods with low rents and you know the type of tenants that come along with that.

1 Vote

Jason Reyna Welcome to the community! There are some great REIA groups here in town! You can see when they meet at www.biggerpockets.com/events

0 Votes

Jesse R. I would be interested in investing with you. Let me know when you find a good deal and I will analyze it with you. I'm new to the game as well but I have some money to invest.

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This is a question for a CPA but you may want to wait to talk with one until after the tax reform bill that was proposed today is either passed or rejected. The bill as proposed is only going to allow a mortgage interest deduction on a loan of $500k or less. So it would depend on the amount of debt you are looking to consolidate.

0 Votes

A lot of these will hurt many of us at the personal income tax level if we have been itemizing mortgage interest (on a mortgage over $500k) and property taxes on personal residences (over $10k). The biggest impact will be to those investors that are doing the "live-in flips" because they have to live in it for 5 out of 8 years rather than just 2 out of 5 years.

4 Votes

Hi Kale,

I'm currently living in the Las Vegas area. I'm also new to BP and it's nice to see that I'm not the only one excited about this market! I'm planing on going to the coffee meet up on August 26th and it would be nice to see you there!

1 Vote

I'll be attending. This will be my first event and I look forward to meeting everyone there!

1 Vote

All Forum Posts by: Spencer Karr

Spencer Karr has started 0 posts and replied 9 times.

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