All Forum Posts by: Daniel Smith

Hi all,
Is standard real estate commission at a full-scale brokerage still 6% to the seller? Somewhere in my mind I feel like I heard 5% is the standard when selling a high-end property (mid 7 figures). Am I just making that up? 

Hi Raj, I'm in a similar situation and would love to connect with you about it. I sent you a PM. I've been in touch about this very issue with a lawyer who's had dealings with CSC in the past.

Anybody else received these letters from CSC? They send you a certified letter requesting that you make one of two choices to amend your commission structure (neither of which is beneficial to the landlord) because of "underperformance" of the machines. If you fail to respond to the letters, they make one of the choices for you. 

Quote from @Mike Nelson:

Are there any updated on CSC Coinmach or CSC Serviceworks?  I just received my check for six months.  My piece of the take is about 15%.  I have just one washer and one dryer in the building.  The contract was signed by the previous owner prior to my purchase in 1987.  I have never had a copy of the contract, and CSC has not returned my calls.  Until now, the laundry service/ profit margin has been OK, not something on my radar.  I want to buy my own machines, collect money and manage service requrests.

Hi Mike, did you ever get resolution on this issue? I have received the same ridiculous "we are changing the payment terms of your contract" letter. Same two options as you.

I would love to find a Valley meet-up. I think a couple of years ago there used to be one on Wednesdays at the Sizzler in Van Nuys.

I am not a CPA but have been doing a deep-dive the last couple of days into this new tax plan.

Little known interesting fact -- there is actually a new tax bracket. And it's higher! There is now a 41% tax bracket for the first 200k of income over $1,000,000. This is not being publicized much.

The pass-through rate at 25% is HUGE. Hugely beneficial to high-income earners, most of whom run their own businesses or at least are in partnerships (doctors, lawyers, etc.). Also potentially a massive loss of revenue to the federal government. Kansas tried this kind of thing and it wrecked their economy. Something to look out for.

Reducing/eliminating SALT (state and local tax deductions) and student loan interest I like to call the "screw you Blue state voter" parts of the plan.

If I understand it correctly, the property tax deduction changes are not retroactive. You can be grandfathered in on the house you currently own. But this could send shock waves through the real estate market as inventory could plummet. From now on you will get no property tax deductions on second (vacation) homes. Of course, investment properties are still covered as these are business expenses.

If you own a very profitable real estate business, you could see your income now taxed at 25% instead of 39.6%. However, I suspect most of the people on this forum aren't in that subset anyway, as depreciation limits most of our "profits" and the tax change won't impact much.

Thank you guys. That makes a lot of sense. I'm glad they "round up" to have a month instead of requiring things by the day.

I'm working on my Schedule E for last year. I have two properties. Property 1 was available for rent 11/15/16. Property 2 was available for rent 12/28/16. 

When calculating depreciation, it's my understand you can use partial months. So for property 1, I can depreciate for 1.5 months. However, for property 2, should I depreciate for 0.5 months? Or calculate no depreciation whatsoever, since there were only 4 available rental days?

Thank you for all the info!

Just to clarify: on a split commission, are we splitting 6-8%? Or each paying 6-8%? That's rather hefty if so.

I know that in residential sales, the seller usually pays the commission. However, on loopnet I see a lot of listings that mention a "commission split". Is this customary for commercial transactions? Buyer and Seller each pay 3%?

Thank you, Brandon!