All Forum Posts by: David Nacco

@J. Evan Davis I am in the military myself and I’m in the HR area. My friend is also in the military still and he is a wholesaler/flipper and making good money right now. One of the bigger flippers I know of in the area is in the military right now and is killing it. I am in the process of becoming a real estate agent and am just trying to decide on a brokerage right now. I also invest in rental properties and am about to start flipping to get more money for rentals.

Does anyone here have any experience with starting and operating a nonprofit organization? I am planning to buy a farm and won’t have use for all the land so I would love to start an organization providing agricultural, hunting, fishing, etc. educational and recreation programs for youth. I would like the food grown on the land by the kids in the programs to also be donated to local food banks. I want to try to keep the costs to participate in the programs as low as possible to only cover operating costs (low for the kids and their families I mean). I would also like to possibly do a program where any extra money raised or donated could be used to build homes for families who are going through some sort of hardship (ex. loss of their home to a fire or disaster) to get families who don’t have any other means of getting back on their feet into a home again.

How can I get other business owners/charities/community members on board with a program like this. For example local farmers and tradespeople who can teach kids about their trade and help operate the organization.

Originally posted by @Eamonn McElroy:

@David Nacco

In addition to what @Bob Norton wrote, it's implicit in the qualifications of a home office that the home office will not be used as a dwelling unit or for dwelling purposes.  Therefore, the home office unit/building/room/clearly divisible area is not residential real estate but rather nonresidential real estate, and is 39 year GDS property.

 That makes sense thanks for the info!

Originally posted by @Bob Norton:

@David Nacco Home offices are considered commercial real estate for depreciation, even if they are in a residential building.  So, you have to depreciate them for 39 years. 

Thank you!  

Originally posted by @Eamonn McElroy:

@David Nacco

In order to take the home office deduction, you must use the room/building/clearly divisible structure exclusively and regularly as your home office, and it must be your principal place of business.

If you're building a separate structure you generally would not "write off" the construction costs in year 1, rather you would capitalize and depreciate the structure over 39 years.  Home offices should be depreciated over 39 years, not 27.5 years.

Alternatively you can take the $5/sq ft safe harbor if the home office is less than 300 sq ft (most are), but I've found that the actual expenses method almost always produces a materially higher home office deduction and is generally the way to go if the taxpayer is okay with 1250 gain from depreciation later down the road.

 Thanks for the input! Can I ask why the 39 years rather than 27.5?

Could someone who is tax savvy help me out here? I am considering building a home office, and by building a home office I mean actually building a completely separate structure from the living area behind my house. Would I be able to write off the construction and furnishing costs of building this office on taxes as a business expense? What about the costs of pulling any necessary permits? I know I could just get a good sized shed and convert that into an office space but I figured if I can write off something nice that looks and feels more like an actual office then why not do that

What are some tools/methods to use when making cash offers? So far I have:

-hard money

-private money

-actual cash

-business lines of credit

-home equity LOC

What else have you guys used for cash offers? I wanna start working with more wholesalers but I need some faster financing options.

@Ej Speller I don’t currently wholesale because I am focusing on building my real estate agent and rental business right now but I have a good friend who is also a new wholesaler/flipper and he’s really killing it and he’s moving very quickly! I’ll definitely get you in touch if you’d like.

@Ej Speller I’m in Suffolk!

@Jonathan Martinez Congrats Jonathan! You’re almost at 1% with just a single door that’s great! I hope it goes well for you and let us know when you get the next one!