All Forum Posts by: Gary F.

Hi Phil

Are you setting up RCFE care homes? In CA they're called Residential Care Facility for the Elderly and require state licensing.  I was looking into converting my home at one point and I'm in the medical field. I'd start by looking up Florida's state licensing board requirements.  They will list the required environmental/home set up.  The bathroom is usually best set up with a no-threshold walk-in shower stall. You can get this as a full fiberglass insert with grab bars attached. The kitchen doesn't have requirements unless there's WC clearance issues because residents don't cook or use the kitchen.

Are you going to run the business too or just modify the home for that purpose and sell it? I ask because if you're going to run the business then you know how many residents and how you'd want to run it. If you're only modifying it for later sale it may be harder since each business owner has their own ideas. 

Why not just post an ad on Craigslist and see how many responses you get? I see people nowadays have rental Open Houses too on weekends.  

Hello BPers.

I'm looking into converting the seldom used formal living room into a master suite with private full bath.  I plan to rent it out for cash flow.  But does such a conversion add or decrease value/appeal for later sale?  

This room is adjacent to the kitchen, separated by the front entry breezeway.  The kitchen has been opened up and the rest of the house is renovated.  So putting up a wall along that breezeway will close up the open feeling on that side obviously but the wall on the opposite side has been opened.  I cut a 6 feet wide opening that leads into the kitchen.

What say you folks?

Hi Michael Thanks for the great information. That’s more clear now. I was wondering how to budget since I’ll have to pay outright and won’t see tax benefits until later or even only until I sell. For the car it would be also for traveling to other areas for potential RE investing and to network and meetings

It seems because the new 2018 Tax Reform laws are so new I can't seem to find real answers. I searched here and nothing for 2018 tax year came up. Maybe a CPA can chime in.  

Scenario:

Im renting out rooms in my primary residence. I will stay in one of the smaller rooms and rent the rest out.  I know I can only deduct a portion/percentage of the house used for the rentals. This will be most of the house since I'll only be using the small bedroom, tenants will be in the other rooms + the common areas.

Questions:

1) I can deduct the full costs of furniture used to furnish the rooms and common areas, yes?

2) Materials and labor to convert the living room into a master bedroom with bathroom is capitalized or 100% deductible in first year?  

3) Landscaping materials and labor capitalized or 100%?

4) Business use of vehicle capitalized or 100%? I know this gets really confusing.  Some sections of 179 say vehicles over 6000lb GVWT.  

@thomas S. Yes that’s what I was wondering about. His family that might come out from his past. If I do deal with him I’ll do a title report and have papers drawn up with a real estate attorney. I would think then it’s all legal and done correctly. I’ll have to consult with an attorney on this

Hi Christopher Thanks for the reply. Yes I was thinking that there should be someone to help represent him. It’s only his name on the property. He doesn’t have family in the area and may be in bad terms with the family he does have. On public records it’s only his name on the property. But is it correct that the property could be in a trust and just not recorded with the County? Because if it’s in trust then he can’t sign any papers unless he’s the trustee. Any other advice appreciated

Typical scenario. Old man original owner of a house in the shambles. Trash and rat infested backyard. Complaints from neighbors. Weeds growing. Bare walls with exposed studs. Never upgraded since 1972. $7k property tax liens. He can’t take care of the property much less himself. He’s interested in selling to me. But his mental health is at issue. He has poor memory and health. If he signs a contract but it’s found later that he has dementia or other cognitive issues what are the legal ramifications? I’m assuming it would void the contract.

I’d say LG. That’s a very desirable area for sure. And seems like less costs vs an ADU. Do the math but I’d think you would get a better ROI with the LG addition. High rental area and definitely equity in this market

Since it’s your rental business can’t you deduct new landscaping pavers from your expenses? Check with your CPA but I believe you could as it’s considered improvements. Then write off the expenses against your rental income. I’m remodeling my primary residence and am renting out rooms and possibly the whole house. Keep those receipts!