Please help a Newbie

[Mark Ryan Peterson]

Hi everyone, My name is Mark and I am a commercial fisherman who earns 150 to 200k a year.. I am totally fine with this income at the moment. The only problem is when the tax man comes knocking I have to fork over 50 to 55k of my hard earned money! I need to keep more of my money! My solution to this problem is to invest in rental properties, fix and flips/hold and single/multi unit homes. I have experience in Building Construction and enjoy remodeling which is why I find this path to be fitting. Here is where I need direction! Should I put some of the fishing proceeds into a Self-Directed account and use that to start investing? Should I wait until I have enough HELOC in my current residency, and pull that out to start investing with? Would holding all of my rentals under a (s) LLC be beneficial towards the tax situation I am in? Any information and direction would be much appreciated. Thank you!

[Michael Kistner]

@Mark Ryan Peterson

   Welcome to BP! Investing in real estate is a great way to create write offs. Fix and flips could end up hurting you more with capital gains.

    Depending on how much you have to invest I'd look for buy and hold investments. That way you can depreciate the asset as well as any expense that may come from it.

Holding your rentals wont help when it comes to taxes, it's a pass through entity but will help you will liability concerns so if you find a lender that will let you purchase your first ones under an LLC I'd go that route.

Along with rentals have you looked into IRA's or other pretaxed investing to lower your taxable income? Just another way to diversify your money.

  Hope this helps!

- Mike