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All Forum Posts by: Ryan Watson

Ryan Watson has started 23 posts and replied 166 times.

Post: Newbie with tons of questions

Ryan WatsonPosted
  • New to Real Estate
  • Indianapolis, IN
  • Posts 170
  • Votes 23

Veronica,

Question #2, it most certainly can be used as leverage for negotiation. This is where your title company comes in. They will see that the tax bill gets taken care of.

Question #3, go with your own title company. Otherwise you might get suprised with something you dont want.

Post: Earnest Money

Ryan WatsonPosted
  • New to Real Estate
  • Indianapolis, IN
  • Posts 170
  • Votes 23

Thanks for the answer J. been seeing that around here and there but wasnt sure what it was.

Post: Earnest Money

Ryan WatsonPosted
  • New to Real Estate
  • Indianapolis, IN
  • Posts 170
  • Votes 23

One quick question. How come there are two hidden posts on here? Do you guys see that too? Its posts 5 and 6 from the bottom. Assuming this post is the bottom.

Post: Earnest Money

Ryan WatsonPosted
  • New to Real Estate
  • Indianapolis, IN
  • Posts 170
  • Votes 23

Yes, thats a different animal. When you've got extensive maintenance costs that go with a structure, cash on hand is vital. Thats a given.

Post: "To catch a contractor"

Ryan WatsonPosted
  • New to Real Estate
  • Indianapolis, IN
  • Posts 170
  • Votes 23

I saw this show the other day for the first time. This is going to be good sh*t. I saw the one where Jose didnt finish a bathroom job, and they went after him with a PI. Lured him to a fake job for confrontation. All hosted by some comedian guy and an MMA fighter for intimidation purposes. This show is great. ahahahaha!

Post: Tearing down a building .... Fun

Ryan WatsonPosted
  • New to Real Estate
  • Indianapolis, IN
  • Posts 170
  • Votes 23

I already see a safety hazard. I hope you hadnt left those block walls still standing unsupported? You should push those over too, though I wouldn't be surprised if that tractor didnt have the power. I dug up a water line with the backhoe attachment once. That thing was borderline useless, no power, and john deere controls. Yuck!

Looks like your having fun though, and getting stuff done, thats all that counts.

Post: Earnest Money

Ryan WatsonPosted
  • New to Real Estate
  • Indianapolis, IN
  • Posts 170
  • Votes 23
Originally posted by @Will Barnard:

If you don't have that cash, perhaps you should not be playing on this field.

I disagree with this statement. As someone looking to get a first property, vacant land. A doable deal with an opening bid for county surplus at 750.00 is a feasible idea until l you factor in 1000+ in earnest money. Then it just kills the whole picture. If i could get the land for under 3000 bucks, i can afford 100 dollars a year in taxes, and keep the grass cut. Atleast my name would be on something.

Post: My Renter Wants to Buy It...

Ryan WatsonPosted
  • New to Real Estate
  • Indianapolis, IN
  • Posts 170
  • Votes 23
Originally posted by @Donald Hendricks:
Originally posted by @Ryan Watson:
Originally posted by @Donald Hendricks:
Originally posted by @Matt Devincenzo:

You are mostly correct, you would only pay 15% on the gain, but you have to "pay back" the taxes on the depreciation tax deduction you took over the last 14 years

Here is a quick "estimate" of how your taxes would work (I'm not a tax professional and these are just rough numbers to give you an idea).

Your original basis in the property is 62K, which should have been being depreciated over 27.5 years. So you will have taken 32K in depreciation, that will be taxed at the 25% depreciation recapture rate for a tax bill of 8K.

You would be selling for 94K minus your basis of 62K for a gain of 32K net. This would be taxed at the 15% long term capital gains rate, for a tax bill of $4,800.

So your net after taxes on the full 94K would be 94K-8K-4800= 81.2K net after taxes.

In other words do a 1031 exchange and if you want cash in your pocket do a cash out refi on one of the new properties for tax free money that the tenant pays back.

No, a 1031 is where the money comes out of the old asset, straight into the new asset, never touching the owners hands, thus, deferring the tax.

Thus the reason for the cash out refi on the new property.

I learn somethin new every time i come here.

Post: I'd rather be diving.

Ryan WatsonPosted
  • New to Real Estate
  • Indianapolis, IN
  • Posts 170
  • Votes 23

Welcome to the forum.

Im looking to try out scuba diving myself. Chances are good that ill get my PADI license this year. I'm excited.

Post: Do walkthrough on my own first, or bring along a general contractor

Ryan WatsonPosted
  • New to Real Estate
  • Indianapolis, IN
  • Posts 170
  • Votes 23

I like that idea. Especially if you have to call a realtor to the property to gain access. Unfortunately you dont always get to have the broker give you the key code to unlock the key.