All Forum Posts by: Paul Sundin

Haven't seen it in the hard money arena. You probably need to get 70% LTV and then borrow the difference privately.

Imagine paying $299 and generating $10,000 in additional depreciation deductions. In a 40% tax bracket, this is $4,000 cash in your pocket! You might be thinking this is too good to be true, but we see it all the time. It’s called a cost segregation study.

What is a Cost Segregation Study?

Cost segregation studies are used to accelerate depreciation deductions by shortening the useful life of real estate components.

A formal cost segregation study requires the use of a cost segregation professional with an engineering background. Extensive experience is necessary to analyze and apply the various tax laws to the building components.

So what does a formal study cost?

So herein lies the problem. Because of the extensive requirements, many cost segregation reports will cost thousands of dollars and it is not unusual to see reports exceed $10,000.

The result is that it just did not make sense for owners of small rental properties to get reports. So cost segregation studies were typically reserved for large commercial projects. But not anymore.

Here is where Simple SEG comes in

At Simple SEG, we utilize a depreciation model based on a database of engineered cost segregation studies. We are able to complete our reports utilizing comparable methodology and data points for a fraction of the cost of a formal study.

You supply information regarding the different components of the property, such as flooring, appliances, and roofing. As a result of the data inputs, we model the cost segregation report based on our exclusive database of cost components and segregation studies.

Check us out today @ www.simpleseg.com

I especially love mobile home parks if the homes are tenant owned. They make great passive investments. They also have great depreciation advantages.

Only invest with friends if you are willing to risk the friendship. Most partnerships just don't work out. I have seen many friendships ruined as a result of bad real estate deals.

For any real estate investors who want to put substantial funds into a retirement account and invest in real estate, a cash balance plan may be great for you. It allows you to put high dollar amounts (often $200k plus) into retirement and take a full tax deduction.

It works similar to a solo 401k but it allows for substantial contributions. The key of course is a large tax deduction along with a tax deferral. Just call me at 1-844-340-1000 to find out how it works.

I know that there are investors on BP who control HOAs or establish HOAs as part of a real estate development.  

Many do not know that HOAs are required to file tax returns.  But filing an HOA tax return can be complex as a result of a variety of tax planning options.

As a CPA firm dealing in accounting and tax services for HOAs, we know the tax issues that HOAs face.

Feel free to call us for a free consultation.

http://www.hoatax.com

Most of my foreign clients purchase US real estate in an LLC. An LLC is best but make sure that you understand the legal issues if you buy personally and ensure that you have adequate insurance.

I have some foreign clients who have done well in GA.  But the key is finding a good property manager that they can trust.  

There used to be limited financing options for foreign investors in U.S. real estate.  But I have seen certain small local banks offer programs recently.  So they do exist, you just will have to put more money down and pay a higher rate.

Riley - 

There are several things they will need to consider.  They will need to get a U.S. ITIN.  They of course need to consider tax implications. The three main US tax issues that foreign investors need to be aware of are: (1) income tax; (2) estate tax; and (3) gift tax.

Many foreign investors will find themselves being assessed tax at the same rates as US individuals. These rates begin at 10% and go up to the highest rate of 39.6%. Rental real estate will often generate depreciation expense and other direct expenses, so most investors will only pay rates at the lowest level of 10% (if they pay tax at all). The US tax code also has a very favorable long-term capital gains rate of 15% (subject to certain income) that may apply upon the sale or disposition of the property.

In addition to federal taxes, investors will also have state taxes to consider. The US has of course 50 states, but only 43 have a state income tax. But some states impose a transfer tax and other assessments that can complicate the situation. Navigating state tax law and filing the applicable tax returns is certainly not easy.

I hope this helps.