All Forum Posts by: Kevin C.

You can't take the real estate losses against your income, but you can carry those losses forward and use them to offset gains when you sell the property.

With the right mix of properties you can offset profits with paper losses effectively eliminating the taxes on an unlimited amount of cash flow.

For instance, you might have 5K a month in cash flow that could be offset by 5K a month in depreciation - net taxable income = 0.

My sister lost her barn this year to a fire. Husband had been out on a riding mower cutting the grass, pulled mower into barn to re-fill the tank, some gas splashed onto the engine and whooosshhh......

Her husband said he tried to put it out, but everything just went up in a flash. He got out and called fire dept, but they were not able to save the building. It was a total loss everything in it and the building.

They had insurance coverage, but not enough to cover everything.

That's one fire with a claim that I am personally aware of in all my years.

The small fire was this year and did not involve a claim (not enough damage to meet the deductible), the other 2 were 30+ years ago. Not bad at all considering the time frame.

I agree that in the majority of cases you would probably come out ahead by self insuring if you have quite a few units all free and clear.

Liability insurance on the other hand, that one is a must have.

Flood - yep, I've had that too.

Many many years ago, was living in a mobile home by a creek. Creek flooded mobile home - had about a foot of water in the home. Totaled a car parked there too. We were not home when it happened. Insurance covered everything.

A few years later, a friend lost everything to a flood in the same park. Water came up several feet inside his home. Insurance paid off and they bought a house.

Friend lost a lot of items that were not replaceable - wedding album, family pictures etc.

We've had a robbery claim as well.

About 25 years ago, someone broke in and got off with a lot of our belongings (electronics, cameras, jewelry etc). They ransacked the house and took quite a bit. Insurance covered it all.

I had a kitchen fire in a rental.

Damage was limited to the stove - fire dept got there in time to keep the house from burning down.

Turns out there was tupperware or something of that sort in the broiler of the stove (gas stove). Oven was used to heat a sandwich - oven caught fire.

Tenant was upstairs, came down to check on sandwich, opened oven and flames jumped out. Closed it back up, got wife and kids out and called fire dept.

Everyone OK, I lost a stove.
Replaced the gas stove with an electric one.

Congratulations Justin - great to hear success stories like this.

My wheels are still spinning, gotta work more on that traction thing!

Jon,

I'd be interested in your brokers name.

I've run into the same issues where the agent plugs data into their system and it spits out the number that the policy needs to be written for.

In most instances, that number seems to be pretty inflated. To me it looks like their software automatically inflates the number just to keep deductibles high. Seems like a racket to me.

I was with Farmers for a few years, switched to an independent broker who was able to destroy Farmers Fire policy rates. Farmers was not even in the ballpark on Fire policies.

Kevin

Congratulations Ryan, you made some cash and learned a lot - can't beat that!