All Forum Posts by: Chad C.

And can gift 10k to spouse. If I am a real estate pro, would this be a deduction pass through to regular income?

@Michael Plaks yeah, I just feel like I’m bothering him and worry that I should trust what he is doing. I’m just trying to understand, and use the available resources. On the other hand I am paying him, and it seems reasonable to me for him to explain it to me. I asked him where the interest was, and if it should be reported on 2B of the 1040, and he said the software was not imputing interest.

@Ashish Acharya my CPA has a draft return for me, and we spoke about the imputed interest. I just don’t see it on the returns though. Is there a line on form 6252 that shows this division? Line 25?
For one mobile home, I received payments of $7,700 multiplied by .628760 is $4841. He has line 24 and 26 as $4841, I don’t see where any interest is paid.

Selling price is $37,100 x AFR 1.98% is $732, should installment income be $4109, and ordinary income be $732? 

@Mike Adams that would be nice! I hear they are upping the loan amount to 500k

@Ashish Acharya that is some good info. I will talk to him, we talked an hour the other day, and I probably only absorbed 1/10th of it. It seems that AFRs are 1.5-2.5%

Thanks! @Ashish Acharya

 I don’t charge interest, just a sales price. I will buy a 70k property for 50k, and sell it for 180 monthly payments of the typical rental rate 900-1200, or around 200k. 

@Ashish Acharya so if I had no income, I  wouldn’t pay taxes on the monthly payments? I would pay taxes on monthly payments at a ratio of 

cost basis/sales price at a rate of 0%? 15% if income is over 40ishk?

I am buying properties with intentions to installment sale. I will rent for 12 months if it gets me into long term rate

I currently work full time, and I have 10 properties that I have installment sales on, and they will be taxed using long term gains. I got the impression from my CPA that if I was to reduce my employed hours enough(or quit), that the installment sales would be taxed at self employment income rates. I asked where the line was, and he said I need about 60% full time employed to use long term gains? Any input or clarification?  Is this just following the 50% rule of real estate professional status guidelines?

I am trying to figure out if I can reduce my employed hours, keep my income low, less than 40ishk and get in 0% capital gains bracket. Or make 60-80k in rental income (from other regular rental properties)and depreciate enough to show less than 40k. Then pay 0% tax on those 10 properties.

I have been trying to figure out how to obtain REP status to pas losses on, but maybe I want to avoid it so I don’t have to pay self employment tax. it seems that there may be a sweet spot, or efficiency spot, while I transfer to full REP status.

@Alex Uman wow, here in Louisiana my title company will basically do it for free. $250 and they bring it to the courthouse and get it recorded. The $250 is for recording charges.