CFBT vs. CFAT

[Palmira Angelova]

Hi everyone,

What a wonderful community! Really excited to be a member and meet other investors =)

I'd love your take on how a calculation gets from CFBT to CFAT. I've found it difficult to find a good explanation of how CFAT should be calculated, and at which point taxes come into play - assuming property is under the individual's name. 

Recently I even read an example somewhere saying that if your CFBT is $300, then you just take taxes out of that $300 - let's say $100 in taxes - and your CFAT is $200! Simple right..? But...that really doesn't seem right to me as it doesn't take into account the fact that some part of your gross rental income (after you write off deductions) is still considered personal income to the individual and should therefore be taxed. 

Could any investors chip in here with their experience? How do you set up your CFAT calculations?

Thanks so much. Really appreciate your input!