All Forum Posts by: Dan Griffin

@Steven Hamilton II : it wouldn't let me highlight your name in the above post, but I would definitely like more info. What is the rule with deducting? Does it phase out at a certain AGI?

@Elizabeth C.

and @Steven Hamilton II

Can you both explain a little more about this?

That's a good idea. I'll take a look at the schedule E and walk through the formulas. I need to get a better grasp on this.

Shoot. That's a typo. It doesn't look like I can edit. Let me try this again:

Let's assume the following. 50k property.

Net Income = Rental income - (Interest expense + depreciation + insurance + property tax + cleaning/tenant turnover costs) = $456

So do I then pay income tax on the $456? Is there something I'm missing here with how the tax deductions work?

(I also know that, when I eventually sell, I will have to pay "recapture" on the depreciation as well as capital gains on any increase in value.)

Hi,

Can one of you walk me through how taxes work on an investment property?

Let's assume the following. 50k property.

Income - PITI = $910 in cash flow for the year

Rental income - (Interest expense + depreciation + insurance + property tax + cleaning/tenant turnover costs) = $456

So my tax deduction is $456 (saving me about $146 in taxes)

So do I then pay income tax on the $910 in cash flow or do I not since rental income was part of the tax deduction equation?

Sorry...I need to update my profile. This is in Ohio.

Can someone explain the process to me of what happens if I lend money to someone and they can't pay? I would be in first lien position.

Do I go through a long and expensive foreclosure process, or is it relatively straightforward and inexpensive to take the house?

Thanks for the advice here everyone. Most of this is beyond me, but I do know of a real estate attorney who I met through REIA in the city where the house is. It is probably worth an hour or two of his time to see if this is feasible to do in a way that is a win/win.

My wife and I talked about owner financing, but we wondered if you can owner finance something that you have a lien on. I don't know. Maybe I should talk to a real estate attorney. Could be worth the money.

This may be a basic question -- but I don't know the answer.

I have a house in another state that I used to live in. We moved, but kept the house because we had a 2.625% loan on it -- and there was a possibility that we may come back after a few years. I'm a little cash flow negative each month.

The tenant has a great job now and makes a good salary -- but has some pretty bad dings on his report.

What's the best way to sell the house to the tenant? I have a low interest loan and he would likely only qualify for a really high rate. Is there a way to keep my loan and let him buy from me?