All Forum Posts by: Basit Siddiqi

@Kyle Houlahan

The taxable income of fix&flip through a personal and through the LLC would result in the same taxable income, 15K.
Make sure to have everything done in one bank account so you/your accountant can properly do the books. This will also allow you to easily show a trail to the IRS if they ever question anything.

I think you may be thinking of the difference in taxation between buy and hold vs fix and flip.
Buy and Hold - acquisition costs are all capitalized, costs to maintain the rental property are expensed.
Fix and Flip - Essentially all costs are capitalized since the house is considered "inventory".

Hi Kyle - Welcome to Biggerpockets!
You should also make a post in the New Member Introductions forum to introduce yourself. Other like-minded individuals from the Tampa area will be sure to great you and it can be great for networking.

I am concerned not being afforded the protection of the LLC when the property is not held in the LLC.
I am not a lawyer so other can chime in on that aspect. If you were looking for asset-protection you may want to look at getting extra insurance coverage.

On the tax side - I will echo some of the point buddy mentioned above. The only thing I would add it that you may not be able to depreciate some of your rehab costs if you are in the business of fix and flip. The costs would be taken upon the sale of the flip.

Basit

@Mike Weaver - There will be no benefit of transferring the title over to an LLC before sale. You will be entitled to the deductions as if it was sold in your personal name.
I would argue that it will be more costly since you have to pay a title company to transfer the title

@Grant Miller - There should not be a difference between selling the property in your personal name or inside of an LLC (I assume single member LLC(owned by one person) taxed as a disregarded entity(didn't select the option to be taxed as a corporation)).

The passive losses that you accumulated over the years will net against your profit upon sale.

If anything - I would assume that transferring the title to your personal name would be more costly since you would have to pay a title company to transfer the title.

I am curious on what you ended up doing.

Hi Mel - I am a real estate investor/Tax accountant(soon to be cpa in a month). Feel free to ask me any questions that you have.

Hi Lauren - I am not a Lawyer - However, I will take a stab at this.

From my understanding the only difference between a multi-member LLC and a single member LLC is the amount of members where
Multi-member LLC has more than 1 member and
single-member LLC has only 1 member

Was the LLC Articles of Organization created where you and your wife were listed as members?
If so - Can you draft a legal document purchasing your wife's units?

again not sure if this would resolve it.
I'll try to see if I can find additional information

Basit

Hi Everyone,

I hear a lot of chatter about self-directed 401K/IRA accounts and how they are great because they allow you to invest in things outside of stock/ETF/Mutual funds.

For those who have set up these self-directed 401K/IRA accounts.

What is the initial cost to set this up?
What is the annual costs for upkeep?
What is the cost of drafting loan that allows you to take up-to 50K from your 401K

Unfortunately, I have not been able to find this information online. I just want to do some calculations and plan accordingly. 

Backstory: I currently work for an employer where I contribute to a generous 401K plan. I just wanted to plan ahead if rolling over the balance to a self-directed 401K account once I leave my employer to do some entrepreneurial activities.

Thanks,
Basit

Accountant here...Sorry I cant think of any tax savings with either scenario.

Hello everyone!

I have been a BP lurker and I just decided to sign up!

A little-bit about myself.

I am a tax accountant at a public accounting firm specializing in real estate/private equity.

I feel like I can become a good real estate investor.
I am detail oriented and extremely analytical.

While i have no experience with real estate investing per se, i also feel like i understand the industry immensely. 

I live in the New York Area. I find that this area is extremely hard to start real estate investing because everyone is so damn expensive here! 

I work 9-5 Monday-Fridays during my non-busy months. Therefore, I was looking to join a new york Real estate investing group that meets at night or during the weekend.

I am a type of person that asks A TON of questions.
I understand that this is just an introduction...but these are questions i am dying to know and research once i am done with this post

1) is no-money down investing real? what bank in their right mind would want to do this?
if it is real, what type of credit do you need and what is the interest rate like?

2) I am a person who tries to diversify as much as possible...I would rather have a 10% interest in 10 different properties valued at $10,000 each(total of $100,000) than to have a 100% interest in 1 property valued at $100,000.
With that being said, have BP members grouped together to do deals together?
with safety being a concern, what are some things i should out for to make sure i am not being scammed.

3)what is everyone's credentials when looking for a tenant?
above 700 credit score? 650 credit score? income 40x rent? income 50x rent?

thanks,

I hope to learn as much as possible,

Basit