All Forum Posts by: John Teachout

I have filed an extension but am still trying to figure this out. I think the issue is that since we're real estate professionals it's characterizing our rental income as non-passive and thus not allowing the passive syndication losses to offset it. I went through and put the syndications (they're all multi-family rental real estate) in with my portfolio and then they do apply the losses to my income. I'm aware there's some considerations when rolling in LP's and LLC's into my active rental portfolio so haven't pulled the trigger on anything yet.. I likely will not make any additional syndication investments in 2023. Maybe some mineral interests to continue to complicate things, lol.

I'm pulling my hair out over this years (2022) taxes. (turbotax)
I've worked through all the Federal taxes and in 2021 I had an AGI of $111387. My taxable income was $75202 and fed taxes were $3504.   For 2022 my AGI was $80047, taxable income was $46273 and fed taxes of $5004.
This makes no sense. AGI and taxable income way less and taxes way more? What's going on?

Can't figure out why when I enter my significant syndication losses into Turbotax it won't show the losses. I have losses of about $73k and net rental income of about $69k. The turbotax tech said it's because I'm not showing active engagement on the syndications. That doesn't make sense to me. Those are passive investments and should offset my other passive income. I don't have any W2 income but do have social security, IRA income (from a conversion), interest income, some small business income, etc. I am a real estate professional but don't believe that's a factor.

Do you have rental criteria? Does this couple meet that criteria? If so, rent to them, if not, move on. Their credit score wouldn't qualify them for one of my $800 rentals. Despite what many say, I've experienced a noticeable correlation between credit score and rent payments. You should have a published rent criteria that the potential tenants can view to determine if they meet your standards. If it's all subjective, that's when fair housing laws can come bite you in the butt. We also require "proof of income". If they can't prove it, it doesn't count.

Quote from @Richard F.:

Aloha,

I certainly will defer to the more experienced in this particular niche market, but my understanding has always been that "mobile homes", with or without the axles and wheels attached, are "personal property" which loses value, while a "modular home" that is set upon some type of foundation in a permanent manner qualifies as "real property" and as such, typically appreciates in value as an actual investment.

A manufactured home (mobile home, trailer) can also become real property by a process that involves turning in the vehicle title and complying with local regulations. Title issues are common with trailers. Modular homes are always real property because they never were a mobile home. (they are a type of manufactured home though). Modular homes are usually lumped in with manufactured/mobile homes by municipalities.

Did the basement work add any value to the property or was it primarily paperwork?

I agree with the other posters that said to stay out of it. It's not your problem. They'll either figure it out or someone will move. Sometimes these types of issues are an overflow of other problems going on in their lives. It will likely be resolved one way or the other eventually but not a landlord issue.

Maybe they can set up a bank account you can make deposits into. We don't take cash payments for rent (other than move in fees) because it's inconvenient. This sounds like a situation that's only going to get worse with time. Let the landlord know the present system isn't working for you. Let them come up with a solution.

Utilities that aren't separated are always an issue. Why did you do that?

One solution would be for you to cover the utilities and bake it into the rent. This leads to lack of conservative usage but otherwise tenants are going to feel like they're not paying the right amount.

The price is too high for what you're renting is why it's still vacant. Anything will rent at some price. You need to base the asking rent on what the market will pay, you can't factor in your expenses or investment as that really has no bearing on the market rent price.

Quote from @Richard F.:

Quote from @Harita Konjeti:

Lease says that "tenant should find someone or rent will be accelarated and pay for rest of the lease period". 

 Aloha,

I would be surprised if this were legal, but of course local law applies. Generally you are NOT able to "double dip", or collect rent from outgoing and incoming tenant for the same days. The outgoing tenant responsibility ends the day before new rent starts. Also, you do need to make a "good faith" effort to re-rent.

This is state dependent as far as re-renting the property. In FL and GA (the two states I've had rentals in, there is no requirement for the landlord to attempt to re-lease the property. All real estate law is state and locale dependent and what applies to where someone is may or may not mean anything to someone in a different place.