All Forum Posts by: JayCinta Henry

Whoa, ok. 

1-So either way IRS will be collecting tax on the depreciation amount at the point of future sale?

2-How about question 2 above, your thoughts? 
"If you do a 1031 exchange and you took the 27.5years depreciation, doesn't that benefit you, or does the tax incidence "travel" into the new property?"
Let me add this...basically if I do a 1031 on the property in the future does the tax I could have otherwise paid, get transferred into the new property, and the cycle/process begins again/or continues-deferring tax payment on depreciated amount? I am reading up on 1031 and just trying to understand them.

An accountant friend advised not to take the 27.5 years depreciation because when/should I sell the property, federal taxes will be due on the total amount depreciated and written off.  What do you make of this?

If you do a 1031 exc. and you took the 27.5years depreciation, doesn't that benefit you, or does the tax incidence will travel into the new property?

Showing activities increased since op, they shortlisted and vetted 3 potentials and signed best qualified (at asking $) for May 1st move in. 

Knox Financial will be holding deposit in addition to a 3k reserve that I already submitted to them, terms are 2x of mortgage or 3k minimum.  I was preparing to hand over another property to them as they are giving me a pretty good deal on hazard insurance drops from 1600 to 1060 with travellers, property value covered goes up from 135k to 187k and my liability goes up from 300k to 500k. Their fee is 10%, no one month rental finder fee,etc none of that, just 10% monthly. Problem is I have to fund an additional $1400 reserve for a total of $4400 on both properties, and them expecting me to hand over deposit for this second rental (we are discussing this later today.) 

Me thinks this is obviously too much cash in their hands. Should they go under it would leave me in precarious position trying to extract the same out of a bankrupted corp. No one cares for that.  Decision is to stop for now until I hear what they propose. My question is, is this the norm when you have a PMC run your rental? If anyone has a PMC what arrangements do you have on reserves if any, deposit holding and anything else?

I want to do a $1-2m umbrella policy. How did you guys go about it, any tips, points to consider, who and what, that you can share?

Whatever you do buy the property, since it had met your requirements but for this snafu.  Three years from now you will be glad you did. That 8k  now will be like a pimple on an elephant's butt. Of course you shouldn't bleed cash deliberately. However, your situation is unique. Talking from experience. Almost walked away from a deal three years ago after among other !@#$% seller jacked up price from 125k to 130k but 35% gain has made up for it.

I appreciate, and I am considering all the interesting points everyone has put forward so far. I have watched lot's of Clint Coons and Anderson vids, they are fascinating, and when I used to listen to Dave Ramsey I do remember him talking about putting one or max two, rental properties in LLC. All this is where my question emanated from.

This is a house we purchased as a primary, with a personal mortgage, house hacked for one year and moved out to let it be a rental. I don't know how applicable the LLC would be in my situation -i.e. a personal mortgage on one hand but on the other, an LLC to conduct the rental business-sign lease, receive rents, pay out expenses, etc. Businesswise, is there any benefit that can accrue in/from this setup, and is this normal in business or it's just starting to get convoluted for not much of anything really? We would look to conduct similar arrangement on two other rental properties a little later in the year, only if this made business sense.

We have put up our house for rental after staying in it for one year, and onto the next.

1-Can you have an LLC as a landlord and for it to receive rents, sign leases, etc, even though I am the mortgage borrower?

2-If yes, does the LLC file it's own taxes or can you add it's financials as rental income in your personal taxes?

3-When do you consider placing properties in an LLC as a small scale landlord (2...3) properties? Is it advisable to place each in it's own LLC or for starters it's ok to have one LLC with multiple properties, possibly split them up in the future?

 I am having them lower it this am. Recently a family with 4 kids, preteens, came by while I was there. I asked them for feedback and they said the kids said the bedrooms were too small for them. And that is true. 

Great tips, thank you everybody. I appreciate. 

I know bad tenants are costly. So I am careful about that. So fast and good here are very measured. @Matthew Irish-Jones I was thinking we have similar demands here in the Dallas area. One city over in Mesquite I know this landlord who put up his house for rental all for three weeks and had a line of folks to vet at about $2100. His house needed some updating after previous tenant vacated. I am surprised that there are about 4 houses in my general area that are still on the market, after this long. I will talk to listing agent, clearly we need to re-examine the price point.

This is a PMcompany. They charge 10% comm. monthly, that's all. In another rental we used a local agent, he charged the same, plus 1st month's whole rent.  The whole thing worked out to approx. 17% monthly comm.   And also adds  a surcharge if they arrange for repairs. This Knox PMC beat everybody with house insurance through Travellers, $1800 vs $1200, with a higher insured value, and  a higher liability 500k vs 300k. That's why I wanted to bring in this PMC at 10% and nothing else. But I am losing more than the 17%.  This will be the last month I am with them.

 Great idea, Thanx! I will post at the local one, PD, Fire, etc.