All Forum Posts by: Buddy Holmes

@Natalie Kolodij  Well you can teach and old dog (actually a gator) new tricks. I did do my 2016 using Turbo Tax and did buy their Audit Defense again last April, and even did notify the Audit Defense of my new lovely letter from the IRS.... However I do have call into a gentleman who I think fits that description.   Happy to take a PM on any recommendation on help this time through the gauntlet though.

But for this post is this actually typical of an IRS Audit?   I mean, my son had a serious accident during this process and short on response time I actually pulled an all-nighter just to get the info to them on their schedule.

Cheers,

Buddy

As a retired graduate level engineer, I have always done my own Federal and State Tax returns.  Albeit for a couple of dozen years now I have used Turbo Tax to prepare and file returns.  I have always tried to understand why Turbo Tax does what it does and keep up with the tax laws themselves.  For more than a half century I have never had an IRS Tax audit until last December that is.  "Lets review your 2014 and 2015 returns"   Fine in completing my first 1031 exchange in 2016 I had consulted with a local recommended tax accountant on how to file a return for a 3 replacement for one exchanged property.  Turbo Tax nor the Federal forms and example were less than helpful on this.  As an aside, the California Tax forms were set up to handle this easily!?

In any case the consultation went well but the account said whoa don't file that Schedule C for any Real Estate expenses!  He was correct in that was what the IRS was interested in.

Being the somewhat the annul engineer, I had come to the decision that I would use Schedule C for expenses that were for more that one of my rental properties and car travel  keeping an eye on our multi-state rentals.   OK, It was a ban Idea. I know that now.

I tried to tell the auditor that I was better educated now and would be happy to re-work my 2014 and 2015 returns placing the Schedule C expenses to their proper Schedule E categories.

I was told "NO your can't revise your return once under audit."  OK, I can see that might be suspicious.

In any case the auditor says the audit is now over.  The only problem is that many expense categories were just totally rejected even though I provided detailed files of scanned receipts.

There is no explanation from my Turbo Tax Defense Audit Representative.  I am left with not knowing if the Audit Rep didn't pass the files although He said he did; or whether the auditor just didn't look at them, or believe them or...  

And guess what the IRS audit closed itself on 21 September and wrote me a nice letter the next day saying I have been selected for an audit of my 2016 return.

I certainly hope this is a not a normal IRS audit but would be interested in other BP'ers who may have been audited!

For all equivalent property purchase deals: 

The best cash flow on a property is from paying cash and not having a mortgage.

However, this is the lowest return on the money invested.

So I don't think that is really what you are looking for.

The best return on a given amount of money you have to invest is to use as much mortgage as you can on several deals.  The cash flow on each deal is less but the sum of all the cash flow from the several deals is the most return and hence the best portfolio cash flow.

Cheers,

Buddy

Amen to these tips. I have had connect requests where they have no photo and no profile what so ever.

Why would anyone connect with this person? Show some interest in learning the process of BP if you want to get some help from BP'ers. I might add, although I have not done this, is to add areas of the country where you have REI interest. Especially if this is outside of your residential area.

Cheers,

Buddy

@Michael Farrugia, I have had a FL SFR since 1998 and have had some damage from 2 different Hurricanes. Neither of them were bad enough to be a problem for the tenant. It was a long process on the first one witch required a new roof but many in the area had tarps on the roofs as they waited for contractors to catch up. I grew up in Florida so, hurricanes were just a fact of life. Tornadoes in Kansas, earthquakes in California, hurricanes in the South, and heavy snow in the North. In FL, the wind coverage is higher than other places but buy rent coverage if you have a mortgage. I also have a SFR in CA and we do not have earthquake coverage. This is perhaps a larger gamble. I have called my FL PM and wished her well. She lives in coastal Daytona area and they have steel hurricane shutters and are not worried.

The good lord provides the best insurance policy!

Cheers,

Buddy

Make your offer, Do include a letter with all the reason for your desire for the property, the reasons for investing for your child (maybe a photo of the baby) and your plans for the duplex in the future.

Give it all you have if you want the deal!

Cheers,

Buddy

hello @Jeremiah T.,

I have a couple of SFR's in Florida being handled by a good property Manager. One for more than 19 years and one recently added.

We have another in California managed by a Bro-in-Law.  Had this one and another there for 10 years.

The local SFR are also under property management.

Not much difference in or out of state. 

South Carolina tax laws don't allow out of state RE losses so your state tax laws might add to your decision.

Cheers,

Buddy

I can recommend Mark Weeks as a good closing attorney,

Cheers,

Buddy

I have tried Mint and Personal Capitol.  I will have to say both do a good job of seeing all on one sight, but mint has more tools at this point.  You can set budgets and track them.  You can set tigs for individual rentals and tax deductible items and sort by those tags.  You can then export to excel any of the sorts.

Cheers,

Buddy

@Tahnya Pierce sorry to use this post to connect you with @Leslie Pappas on your most recent problem post on making a 1031 exchange happen by Friday, but...

I could not respond directly on that post.

Cheers,

Buddy