All Forum Posts by: Lucas Carroll

@P.J. Bremner, @Natalie Schanne Excellent point about the insurance companies possibly not covering non-permitted areas.  That's not a liability I want.  

The ceilings and egresses meet the code, we didn't touch the plumbing but we added some outlets so I'm figuring a few walls might have to come down.  I haven't worked with the inspector yet, but with this being my second property in town, we'll see...

What happens if the previous homeowner made changes where a permit should have been pulled and wasn't and the inspector notices it?  I imagine I'd have to pull permits for that as well and make sure it's up to code.

Thanks @P.J. Bremner and @Chris Christianson for the feedback.  I'll head over to the planning office, take my lumps and finish what I should've started with.  I think it will give me more options on what I can do if it is on record as a 4/2, esp. if something comes up and I want to sell/1031 it.  The increased tax will cut into my cash flow, but I should have included that increase in my numbers. 

Thanks!

Hello BP,

     So, last year I picked up a 1,900 sf rental property which was a 2 bed 2 bath.  It had a large finished basement so I was able to section off two areas and make additional bedrooms out of them.   It is currently rented as a 4/2. This was done without pulling any permits, but the rooms *should* meet the requirements for a bedroom per 2016 ct building code.  I did the work and while I'm not a GC, nor did I have a GC work with me on this, we reviewed the code before building those rooms out.  The property, as a 2/2 appraised for about 180k, but comps in the area put it at about 240k as a 4/2.  In order for me to do a cash-out refinance, do I have to pull the permits and update the information with the town?  Do you suggest I get a GC out prior to permit/inspection to verify?  Or just run through it with the town and fix what they say needs fixing?  I'm intending on holding this property for a while, so I'm not concerned with listing for sale as a 4/2.  This would change the assessed value of the property and bump the taxes up accordingly as well.

Any thoughts or suggestions?

Thanks!

Hi @Anthony Varela,

     You mentioned owning two properties and wanting to move to a more spacious home, so I'm not sure whether you and your wife lived in the condo (and used it as a primary residence) for 2 of the previous 5 years.  If you both lived in it for 2 years you'll be able to exclude 500k worth of profits on a sale.  If just your wife lived in it for 2 of the past 5 years you'll be able to exclude 250k in profits.  You'll have to recapture some depreciation from the time used as a rental, but it might be worth taking the exclusion from the taxes rather than deferring the taxes and carrying forward a reduced basis (as you would in a 1031).  Of course, if neither of you lived in the house for 2 of the past 5 years, it's kind of a moot point.  

Hi!  

I am looking to fulfill the experience requirement to pursue my CPA license. I am currently working full time, so I am only looking for a part-time / off-hour intern type role under the supervision of a CPA.  While I have not yet sat for any part of the exam, I have met all of the education requirements, I have an MBA, I have been an Enrolled Agent since 2014, I am working on becoming a QuickBooks ProAdvisor and I am a (new) real-estate investor.  If anyone knows of a firm searching for such an individual, I would love to speak with them.  And, of course, any other suggestions / comments would be greatly appreciated.  

Thank you,

Lucas

Thanks for the tip Ryan Arth.  We're not closing till the end of the month so I'll update when all is said and done.

Thanks Jim Adrian!  I'll take a look at those.

Forgot to mention, it's a well and a 2004 construction.  Neighbors do not have the same problem.

Thanks!

Hi, we're looking at a house but there is a very strong sulfur smell coming from the plumbing.  It comes from all faucets and doesn't go away after running the water for a while.  We were thinking hydrogen-sulfide producing bacteria (thanks google).  So, we sent the water out to be tested and it came back clean... nominal sulfates, no bacteria, 7.5 pH, and (amazingly) no odor.  Has anyone had something like this happen?  I read another BP thread about a single sink where the smell goes away after a few seconds, but this is continuous and all of the faucets.  Any thoughts would be appreciated... it completely blows my mind that the water test came back clean.

Thanks!

Lucas

Hi,

I have a few questions about the use of land-trusts and LLCs to protect assets. So, I understand the land trust protects the privacy of all owners and the beneficiary of the trust can be an LLC in order to provide the additional level of liability protection if the property gets sued.

In this set up the owner is a member of the (assume multi-member) LLC and so receives a Schedule-K every year, even if the LLC is not active in any business during the year. This is assuming that all of the financial transactions are held within the trust and no income actually flows to the LLC.

So my questions:

Can all of the financial transactions be held completely within the trust, with none of it flowing to the LLC or are there minimum required payments, similar to an S-Corp situation?

What level of protection (if any) does this set up provide if the owner is being sued? Does the owner or the LLC have a legal responsibility to reveal that the LLC is the beneficiary to a trust and thus open the financials of the trust?

Finally, any thoughts on how the level of protection would differ if the owner was "being sued" vs "being divorced"? (assume not community property state)

Thanks,

Lucas