All Forum Posts by: Darryl S.

 I believe I would place electrical upgrade as a high priority item on my rehab list. Modern society (unlike 60 years ago) uses a LOT of electrical devices that draw a LOT of power and we demand to have plugs including GFI's at proper locations. You might not recoup 100% of the cost but it will for sure make for a quicker sale.

Is the old Ford Glass plant still in operation out there in Broken Arrow? I worked there a years ago on a furnace rebuild construction project seems like we played some bingo at the Indian reservation while we were there LOL.  Have a great day and good luck with your rehab.  

 Jon;

See here is the thing. I consulted with my Real Estate Attorney (a very reputable and knowledgeable real estate attorney with many years experience and the owner of a title company) The recording at the actual value is not in question as that is a 100% completely legal action. What no one seems to have researched and gotten a legal opinion on is that since this perfectly legal deed amount is recorded "after" the closing and by an "official government entity" and all the sales and transfer taxes etc. are charged at the recorded amount does that establish the actual Tax Cost Basis of the property?  Easy answer is NO but unless there is a specific clause in the IRS code prohibiting this it MAY very well be a big YES and that this is a legal loophole. Lots of investors may be paying out the nose on short term capital gains because they do not have good counsel...... My CPA is working on it and it might take a few months or even years. I have sought out this real estate site to try to find a real estate investor that has a lot of real world experience that may have run into and done some actual research on this "specific"  issue. Sorry that I am so persistent but if I had listened to all the naysayers years ago I would still be sorting grades of lumber at my local building supply for minimum wage LOL.      

Dave T

Thanks for your reply. That was a few years back and they may have possibly closed the loophole by now but I was referred at that time to a tax preparer by my real estate attorney and they did use the basis adjusted to the sales price ONLY because I questioned it and pushed them to do the research. Saved me about 24k just being persistent on this deal and I found it fascinating that no one seemed to be willing to question the norm LOL.  My point is that there are times when we should not just accept the status quo. I am currently working on my CPA to do some "extra work" on another scenario that could potentially save me from making a very large donation to our very wasteful Federal government. I feel that I am much more capable of properly allocating and spending my own funds than ole Uncle Sam. (see attached pic)  I am laying flat on my back for the next few days from a recent back operation. I am bored to tears and have a lot of extra time to enjoy this very informational website. Happy New Years day Everyone. 

So sorry for your issues Holli. I used to know a landlord that told me how he got his debtors to pay if he ever had any problems. He said he called his uncle Guido in Chicago to come down for a visit. His uncle would come down and have a chat with the troubled payer. He claimed that they were always really cooperative after uncle guido talked to them. He said he was not sure what his uncle guido said to them as he would never let him go with him but it always worked. The old boy must have had a golden tongue or something? Do you have a Uncle somewhere that could help you like that?  

 Jon thanks for your reply (great real estate Forum here). I guess my thinking is that the number is not arbitrary since the Gumit (aka IRS) used the 260k amount to tax the sale for transfer taxes etc. I think it should be considered the official cost basis and usable on this property I mean heck the Gumit said so...... You cannot fight city hall man, so I have heard.  

 Hello Bill, Short term capital gains are a killer I was sure hoping for someone who had been in a similar situation and was aware of a loophole. 

This a different scenario but it might help someone else out there that is interested. I had a property a few years ago that I had bought for 180k I sold it on a land contract for 360k and then the fella could not make the payments so I took it back. My Basis from there forward was 360k which saved me a ton of capital gains taxes on the next sale. I have my eye on a new BMW so hopefully I can figure out a loophole here on this latest deal "Baby Aint Got No Shoes"

 Hello Chris thanks for your reply. I am working on capital gains taxes not property taxes. Property taxes are always a struggle last time I appealed my property tax appraisals they brought a few down and a few up so it was not worthwhile to me. In my County they set you down in front of a panel of people and intimidate you like you are on trail.  Our Gumit at work LOL  

Dave T;  Thanks for your question. I asked my attorney to use that amount as that was the actual value of the property when I bought it. I figured that should set a realistic cost basis for me. Maybe that is too creative?        

Calculating Tax Cost Basis Question: I would like to use the amount that my property deed was recorded for at the courthouse recorders office as my tax cost basis instead of my closing HUD statement amount. Can I use the publicly recorded amount as my cost basis for which I paid extra taxes (260k) or am I forced to use the HUD statement amount as my cost basis (155k)? Seems to me that if I paid the extra transfer taxes etc. on the 260k  that I would be entitled to use the recorded amount of 260k for my cost basis??  That way when I sell I will not be hit with a lot of capital gains taxes........    You see the stepped up basis applied all the time to properties in certain situations so it is not that unusual I just want to investigate a possibility here.