All Forum Posts by: Bill B.

Does “chuck” get away with his theft from “lender”?

Hopefully Sally gets the place back. Maybe gets to sue Chuck for moving/living expenses while “evicted”. 

The reason it’s usually not done is the profit isn’t pro-rated, it’s consider $100% first. So if you had a $100k gain and did an exchange from a $900k property to an $800k property you would owe the same taxes (on the $100k gain) as not doing an exchange. 

So…either the cheaper property has to be close, or the gain has to be massive. 

@Dave Foster could probably tell you where the 25% taxed depreciation recapture figures in. If that comes before or after your capital gains taxes. 

Reach out to @Dave Foster. You can search for him here on BP and see how many times he has reached out to help people with timely expert advice. 

I used him in 2023 and it was $1,000 give or take? ($700-1,300). I didn’t really matter as it helped me save/defer $60k in taxes. 

Just make sure you have your QI in place BEFORE you sell and never touch the money. 

On a side note I also used John Maher at Key Properties to sell< purchase and run my property if you don’t have that lined up yet. Good luck and congrats on escaping CA. Welcome to NV.

If you click on the magnifying glass in the upper corner you can see the previous responses. (This literally asked monthly if not weekly.)

Until you have more than 25-50 properties you can use Quicken. (Quickbooks little brother.). It’s overkill but it’s much cheaper and easier to use. 

@Sean Graham isn’t your example paying for another cost segregation, which will cost more than a 1031, just to break even on taxes? As opposed to either doing the cheaper 1031 and being ahead on taxes. Or doing the 1031 and a cost segregation and being way ahead? It seems like the worst choice. 

I'm probably just coming at it from a bad angle as I'm not a big cost seg fan on SFR. I like having my depreciation expenses being available against just my highest taxes every year rather than use too much in year one. Of course I never had a really high w-2 income to offset. So I went almost 7 years paying zero taxes, until I started paying properties off. Now as my income accelerates I'm happy to have the depreciation.

I was simply trying to make the best of his bad situation. I don’t make any money whatever he chooses to do. It’s all good.  :-)

Short answer is you’ll owe as much or more taxes than you saved with your cost segregation if you don’t do a 1031. So, If you don’t do a 1031 you shouldn’t have done the cost segregation. If you thought that was worthwhile this should be too. 

The last two times I was selling a house random local realtors reached out asking if they could host open houses. (I assume trying to get free leads or market their name as the local expert.)

If no one at your broker will help, reach out to new realtors. (Or “neighborhood experts”) You can offer some money too. But it’s their chance to learn, meet people, network and advertise themselves. 

She knows he probably owns at least half the property too right? Taking him off the mortgage doesn’t take away his equity. So, if he owns at least half the equity. Is there anything left if you give him half the equity and can only borrow 75% of the value? 

Maybe just piss him off so he forces a sale if the property. 

Why would you? A 1031 delays taxes, it doesn’t eliminate them. You’r going to we the same taxes when you pull the funds out.

The “winning” bid will almost always start at the mortgage balance. And the ONLY people being foreclosed on have to have purchased very recently and have zero equity. Otherwise they would have sold, taken the tax free cash and moved on. 

Hence you’re finding “almost retail prices.”  

We’re at or near record low foreclosures, you’re farming a hard row. 

You’d probably find “bigger discounts” from people who put a large amount down when they bought 2-5 years ago but have to move. Or have owned for 10+ years and have had a death occur. Search for properties listed 90+ days. You’ll be surprised how many people are afraid to offer 10-15% off asking when the buyers would at least entertain such an offer.