All Forum Posts by: Jay Patadia

Terry,

You can do 1031 exchange to defer gain on the property you are selling. The gain will be deferred to the property you are buying. There are few rules for the 1031 exchange that needs to be followed to defer the gain. That way, your AGI will be unchanged due to these transactions.

@Joshua Davies

There is no tax on cash disbursement to foreign partner, tax is only on the net rental income (includes Depreciation, Amortization). If there is loss, no need to withhold anything.

@Joshua Davies

As per IRS, rental income will be taxed depends on whether or not the foreign person who owns the property is considered "engaged in a U.S. trade or business." Ownership of real property is not considered a U.S. trade or business if it consists of merely passive activity such as a net lease in which the lessee pays rent, as well as all taxes, operating expenses, repairs, and interest in principal on existing mortgages and insurance in connection with the property. Such passive rental income is subject to a flat 30 percent withholding tax (unless reduced by an applicable income tax treaty) applied to the gross income rather than the "net rent" received. Thus, the real estate taxes, operating expenses, ground rent, repairs, interest and principal on any existing mortgages, and insurance premiums paid by the lessee on behalf of the foreign owner-lessor, must be included in gross income subject to the 30 percent withholding tax. The gross income and withheld taxes must be reported on Form 1042-S, Foreign Persons U.S. Source Income Subject to Withholding to the IRS and the payee by March 15 of the following calendar year. The payor must also submit Form 1042, Annual Withholding Tax Return for U.S. Source Income of Foreign Persons, by March 15.

@John D.

check out Wave accounting software. Recently acquired by ADP.

Pros - It's Free, In cloud, Good for single property

Cons - Slower, Can't do data backup like Quick books

@mike h. 

Yes you can deduct 100% lease payment made for this panels as qualifying business expense if property solely used for rentals. 

If you purchase panels on loan. You can deduct interest payment not principle, can claim depreciation and also may qualify for energy credit. 

@Daria B.

Some CPA just need forms like W2, 1099 etc and key in the information by their staff. Also they will call you for any questions they have. Some prefer clients to do most of  the data entry in terms of filing out organizer. It varies CPA by CPA. Personally I don't like organizer as it duplicates the work rather I have quick call with client in case of any question. Also help me to have more active communication with the client.

@Michael Doll,

It's pretty easy to move property to LLC. Form an LLC and do QC ( Quit Claim) to move title from your personal name to LLC. I will suggest to hire lawyer for LLC formation. If you have a mortgage on property, lender don't like that you move property to LLC as they have lent you money on your personal name.

@Brady Hurs

Generally you do the same way as long as same entity structure. I would suggest to get opinion from local lawyer to make sure holding company comply with state laws from entity formation stand point.

I personally use MileIQ. Accurately tracks milage and has ability to export reports and also integrates with Quick books online.