All Forum Posts by: Jeff Howard

Thanks all, this helps me plan this out.

Here is how I think a short sale works, please let me know if I am correct?   This is based on what a realtor told me when I called about one of their short sale listings.

1. It's in a short sale because the owner can no longer make payments, and cannot sell the house for its full value, but the Bank feels that they can make enough on the house such that short sale is a better business decision than a foreclosure.
2. You get to go see the house, you make an offer.
3. Wait: This can take 9 months to a year, but typically only takes 2-3 months..
1. Note: If in the process of waiting you decide to back out for any reason you can do so by informing your realtor and there are no financial penalties for doing so.
4. Your offer is put in with any other offers and the Bank goes out and determines if it wants to accept your offer or someone else's, or tell everyone to give best and final.
5. Once the bank accepts your offer you post your earnest money.
6. You get to do inspections. Water and Power may or may not be on, and if its not you may or may not have to pay to have it turned on.
7. It works like a typical sale after that, but can take 40-45 days to get through escrow. You can back out and get your earnest money back if your inspector tells you to run or your financing does not come through.
8. You will pay what you agree to and no other hidden fees other than typical buyer closing costs and fees associated with your loan.

Ok, I just went through the rental property section of turbo tax and it helped greatly.  A few questions I had after doing it?

I have seen some sites that say I can write of origination costs and others that say I can't, that I have to amortize them over the life of the loan.  What is the correct answer?

Actually I am using it, the premier version.  I just want to make sure I catch any strategies it misses.  I have found, pre-landlord days, that it tried to direct me away from a better strategy.

Thanks I might look into that.  This is the reason I did my taxes this weekend.  I have a few coaches I can reach out to, along with you guys.

I really appreciate everyone's help on this site.

Thanks for getting back to me, what would have been special about doing something last year? 

We have roughly categories of cost…

• 1.Closing Costs which include inspection fees
• 2.Business expenses which include having signs made, creating an LLC, ordering a P.O. Box,
• 3.We have costs for repairs we did before putting it on the market. Buying sod, plants, paint, mulch, toilet seats, fan, bunch of minor stuff.
• 4.THEN we put it up for rent and started showing and accepting applications.  Over a few months we made the following improvements:
  • a.Bought a refrigerator
  • b.Installed a storm shelter
  • c.Tiled the master bath (was carpet)
  • d.Made several utility payments, gas, electric, city trash
• 5.After the renters moved in
  • a.Several more minor repairs they found
  • b.AC went out but the repair did not improve the unit, it actually took away a feature and was 30% less than replacing the entire HVAC system
• 6.Interest
• 7.Travel miles to the unit.
• 8.Bought a computer that I use 50% of the time for the business (researching more units, running my own business)

Which of these can I reasonably deduct and which do I have to depreciate

I bought my first rental property last year and I am trying to write off as much of the expenditures as I can.  We had a lot of expenses going in, closing costs, repairs, and improvements.  Our total expenses outside of house payments was over $15,000 including closing costs in 2017.

I am reading the book "Every Landlords Tax Deduction Guide" and am getting bewildered.  Here is my question...

I know I can write off up to $5000 in expenses for startup cost, but what about closing costs?  What about maintenance?  Can I write off maintenance over and above the $5000 limit?  Is the $5000 a free deduction off my 15K, and the rest I have to figure out how to justify?

I was told going in you can write off everything, now i am thinking that's not true?  

Help? I have searched and am reading that book, is there a good post someone can point me too?

Thanks both of you guys, checking both out.  Downloaded the podcast.

Wondering if you have any recommendations on how information on how to get started airbnb.  Trying to do it Matrix style, if a book is best I will go that route, if there are good sites that give you the cliff notes version that's fine.  Just want to learn it.  

In other forums we talked about doing a vacation rental, wife and I decided to try it locally and learn how to do it before going virtual.

Thanks all or any help.

Great point on the cameras, might just use a ring and a wifi lock.  The camera in the house would be something I would tell them to immediately take down when they come in, that way I can watch it for vagrants or whatever.  Furthermore I would have evidence that, when they came in and took down the camera the house looked great, if I ever need that.