All Forum Posts by: Greg Scott

What your CPA is saying aligns with what I understand to be true.

However, you are just at the start of your journey.  The more you engage in real estate, the more savings you will get.  At first, you won't be able to offset your W2 income with losses, but it is nice when you sell a property at a profit and all the capital gains are wiped out by losses from other properties.

A huge amount of tax savings get unlocked if one of you leaves your W2 job to focus on real estate and you get Real Estate Professional Status (REPS).  Once you have REPS the distinction between passive income (or losses) and active income (W2) disappears and all those tax losses you have been banking can be applied to the W2.

Good luck

I see you are not from Michigan.  Understanding Michigan property tax laws may explain what you are seeing.

In Michigan, property taxes reset upon sale and then are capped at CPI.  If you look at the tax assessment, there will be an assessed value and the taxable value.  Right after a sale, they will be the same.  As time passes, usually assessed value goes up faster than taxable value.  If a property has been owned by the same owner for a long time, the taxable value could be significantly below assessed value.  In short, it is highly possible a much more expensive neighboring home could be paying less property tax.

What is much more relevant is comparing assessed value to assessed value.  If the larger home has a lower assessed value, you may have an argument.  Given the bureacracy and corruption of the city government, I recommend hiring an experienced tax attorney to fight any assessment.

There is no decision to make.

What does your lease say?  That is a legally binding document.

There is nothing in the original post that stated the resident's situation was anything like yours.  My employer never had such a requirement.  Declaring that I did something unethical, with intent, was an poor assumption. 

My son has worked remotely in IT for years, and none of his employers have had that sort of requirement you do.  Your specific job requirements appear to be an outlier.  This resident likely had more options.

My point is residents will make bad decisions and try to blame someone else.  We recently did a sealcoat project at one of our properties and a resident walked across the wet sealcoat.  They called the office asking for us to buy them new shoes.

Kevin:

I still disagree with you.  I've sat in my car for conference calls, using wifi from a local business.

You are not required to reimburse residents for their poor decisions.  

Let's take it to the extreme. Your resident might say they had to fly all over the country to attend meetings in person since their internet was out.  Would you reimburse for that?  No. 

She could have chosen a much cheaper solution, like go to a coffee shop. Or, she could have asked you about it in advance to reimburse hot spot costs.  Realistically, you probably should reimburse her for the value of the internet you owned.  If internet is $60 per month, in a 30 day month, you should reimburse here $2 per day or $8.

If you choose to offer her more as a customer satisfaction olive branch, that is up to you.

The housing market in Indy is pretty tight.  All of our apartments are at 95% occupancy. If you are having trouble finding a resident, there is another issue. Typically it is asking too much for rent, but it could be your advertising is poor or your property is not in good condition for that area.

"Accept whoever applies" is an idea that would cost you a bucket of money in the long run.

Bankruptcy is usually a "no" unless it appears to be a one-time event caused by something out of their control such as a massive medical bill or a business failure.  Bankruptcy due to poor money management is indicative of a behavioral issue that does not change over time. Do you want to be their landlord if they enter bankruptcy again?

Late payments do not bother me at all as long as they paid all their bills.

This seems wrong.  The application is not a binding legal document. 

We have people that apply that we reject because they do not meet the criteria.  We have people that apply that are accepted, but they cancel for some reason.  Either case shows the application is not binding.

The lease, however is a binding legal agreement. That should be all you need unless there is something strange with Florida law. 

I'd check with another collections agency.

PS. Many management companies archive or destroy old applications because they do not want to be responsible for SSNs getting out to identity thieves. 

I am invested passively in about 50 syndications.

My wife and I have also syndicated four property purchases:   24-unit, a 272-unit, a 281-unit, and a 277-unit.  The 24-unit we sold in 2020 and the last three we still own and manage. We are the sole GP on all these deals so are not just money-raisers relying on an operating partner.

Finding and operating a property is pretty much the same whether you are a syndicator or buy it yourself.  I found the education to be very valuable from that perspective.