All Forum Posts by: John Alosio

@JD Martin

@Bill B.

Thank you for your response. I appreciate you taking the time to help clarify my situation.

 Sir, I keep circling back to it because this was my original question. I'm sorry if i was not able to clearly verbalize, as I am definitely not a tax expert. But i do have basic knowledge of how taxes work.

My original post was my attempt to simplify a scenario so that my question was better understood. But that seems to have backfired.

Your final paragraph finally touches on the answer i was seeking. What is the threshold between cap gain and loss. And how does that affect recapture. Please correct me if I'm wrong, based on what you said:

sell at 100k still need to repay 5k

sell at 99k owe 4k

sell at 95k owe nothing?

i'm just trying to understand the threshold that would be considered a "net loss"

Thank you for your time.

@Michael Plaks

Thank you for your response.

In your scenario, it seems like you bought and sold the property within the same year. Am i reading that correctly?

In my situation, i have several years worth of depreciation taken. so you're saying that i will have to come out of pocket for the difference during next years tax season? despite only getting a small amount of actual gain?

I hear that you would be exempt from recapture if sold at a net loss. So +$1 means i still have to pay?

Thanks

Hello BP family.

I'm here today with a tax question relating to the sale of a rental property.

I have a property under contract right now, my sale price is right around my cost basis.

For depreciation recapture, I understand that if you sell at a net loss, recapture is forgiven. But in my case there would be a slight overage. Just not enough to cover what is owed.

Hypothetically, lets say that I would be on the hook to repay the IRS $5,000 in recapture. However the net gain is only $1,000 beyond the cost basis. What would happen at that point?

Would the IRS then take everything above cost basis until recapture is satisfied?

Thanks in advance for your time.

Cheers

Hello BP family,

I'm dabbling with direct-to-seller marketing. Using the "Sniper" method as opposed to "spray and pray"

Ive been Driving for dollars, digging through public legal notices for pre-foreclosures & telling everyone I know that "I buy houses CASH, AS IS".

My question for the hive mind is regarding Direct Mailing. I'm debating weather or not I should include a picture of the subject property printed on the letter. I'm concerned that doing so could be perceived as a threat, violation of privacy, and turn-off a prospective lead.

Or maybe this is attention grabber? One could argue that people are going get defensive and yell, regardless of the picture or not. So why not get more people to engage in a conversation...

Has anyone experimented with this tactic? If so, did you see any change in results? 

Am I overthinking this?

Any thoughts and opinions are welcome. Thanks in advance.

Cheers

@Chris Seveney

@Randy Rodenhouse

To clarify with rough numbers..., I would "seller carry" the difference between sale price (250k) v.s. what i owe on the property (170k) and hold a note for 80k.

Hello BP fam
I come to you today with a problem; A GOOD problem, as they say.

The situation:

I've reached a point in my journey where it makes sense to sell one of my LTR properties. The fruit is ripe for picking. My goal is to grow my pockets in order to fund flips.

HELOC doesn't make sense because I already have a HELOC on a different property. i was recently turned down by a HML because my HELOC was not liquid enough for their comfort..

My dilemma:

I have a buyer lined up to purchase with a conventional mortgage, OR they could easily assume my current mortgage (lender approved).

If I go with an Assumption, I would get a small down payment, maybe walk away with 5k in my pocket after the tax-man is done with me. This would give me Truly Passive Income from a note that I would hold in 2nd position on the property. $600 a month in Pure Cash Flow! No clogged toilets or leaky roofs, every investor's dream, right?! BUT... this would not help with my liquidity issue. 

I'm in the building stage of my REI career. It seems wasteful to hold a note in my current position, yet I have this nagging feeling that I shouldn't pass it up.

What would you do in my position?

Thanks for taking the time to read, i look forward to hearing everyone's opinion.

cheers