All Forum Posts by: Aaron Zimmerman

I would say what you're looking for right now is a CPA that can prepare your return. However, you will also want them to be a tax strategist if and when you scale to more doors. You will also want to ensure you can ask questions throughout the year, which I don't necessarily view as tax planning.

Bruce - thanks for sharing this info. It's absolutely crucial investors know if they can or cannot use losses. In my experience, cost segregation studies are a lot less than $10-15k especially for smaller properties (6 units and below). What I see is typically in the $3k - $6k range for those types of properties.

@Scott Trench - have you considered investing in short term rentals, materially participating, and having the average stay be less than 7 days? This could reduce your help lower your taxable income if the investment aligns with your lifestyle goals.

Absolutely recommend going with a CPA (a little biased) that works in real estate. Turbotax isn't going to educate you so unless you'd like to educate yourself and potentially make some costly pitfalls, then I'd outsource.

Bruce - this is really good information and is much appreciated. It's important to know your rights and to be able to protect your investment especially with some of the current syndication investments not panning out as expected.

I'd recommend Mike Facchini at Fairway Mortgage Company

Unfortunately it's a necessary evil to weed out the residents that are not ideal. To me, this is an easy non-renewal. If they pay late now as is, let's say they lose a job or have a temporary loss of income, you're kind of SOL.

I would look to build reserves between now and August. Perhaps, they can get out earlier such as July so you have time to do the necessary repairs so you only have one month of vacancy. It's likely you'll be able to raise the rent as well with the upgraded unit and you can look to market it during the time of rehab. 

You'd be surprised how much damage they could do. You don't know all of the people living there so that's a big red flag as well. I've had a long eviction and a big turnover so just trying to help you avoid something similar.

To me, I would just accept Zelle and update Avail if possible and look to see what the tenant is looking for in terms of repairs, how much rent you'll get from them, and if you want them as a resident.

From a tax perspective, you'll want to take what you paid for the property plus calculate the improvements you made to the property during your time of ownership. This will create your new basis.

From an operational perspective, you might want to touch up a few things on the place to make it more rentable. From there, you have to decide whether you want to be a landlord or hire a property manager. If you're a landlord, then you'll want to educate yourself on the local laws. You'll also want to set up criteria for residents. There's a lot on the landlord side that you'll want to get caught up on and it will take some time to get your systems right but I think it's worth it.

 Yes - there are limits but you likely won't hit them. To piggyback off what Ashish said, the limits are. For 2024, the threshold amount is $305,000 ($610,000 for taxpayers filing a joint return). These amounts are indexed for inflation. This is per the 2024 instructions of form 461.

There’s a lot of great suggestions in this post. I wrote an article specifically for house hackers that lays many tax items out for you. I hope it provides some value!
https://www.straightupchicagoinvestor.com/blog/6-must-knows-...