For tax purposes, you really just need to have everything aligned to the schedule E categories. 

The tenants' goals were aligned with yours when they mitigated the leak; they were not "doing you a favor." 

. - Ensure alignment in goals, risk tolerance, and expectations. - Conduct thorough due diligence on potential partners. - For Private Lenders:- Vet investors based on their experience, reputation, and past performance. - Clearly define the terms of the partnership to avoid misunderstandings. - For Both Parties: - Use legal agreements to outline roles, responsibilities, and profit-sharing. - Communicate openly and regularly to build trust.

Starting locally vs. out of state:I always recommend starting locally if it aligns with your goals.

Some are overly leveraged, while others focus on stability and income production—alignment with your goals and timeline is key.While 1031 and 721 exchanges are great tax deferral tools, they’re just one piece of a larger strategy.

Hello Bruce,It's not about interest rates, its about yields and principal risk.In investments you have market risk and idiosyncratic risk.When we think on quantifying these risks and assigning a discount rate, we can look at 2 components.

@Amy Konopka It sounds like your CPA is adjusting your Section 179 deduction based on your business income limitation—which makes sense from a tax perspective, but may not align with what you need for lending purposes.What’s Happening?

Our primary goal is to retain as much equity in our properties as possible while leveraging outside capital to scale faster.Proposed Investment Structure:Investors contribute 30% of the purchase price and 30% of furnishing/rehab costs.Our LLC secures a new purchase loan in its name only, taking on 100% of the debt.This structure allows us to maintain 70% ownership of the property.Properties will be actively managed to maximize returns, likely achieving higher upside than long-term rentals.Proposed Compensation for Investors:6% preferred return annually.After the preferred return is met, profits are split 75/25 (with investors receiving 75% of profits on their portion of ownership).Profit Calculation:Revenue – Operating ExpensesExcludes mortgage principal & interest, as our LLC assumes full responsibility for the loan.Looking for Feedback:Is this structure fair and attractive to investors while ensuring long-term alignment?

Hi everyone,My understanding of the BRRRR method doesn't seem to be aligned with what I'm getting from the 5 portfolio lenders I've talked to in Arkansas.

At that point he/she could explain all the important factors within the agreement you should be aware of.There are various contracts that could align to match the commitments and preferences of the parties.