All Forum Posts by: Jason Powell

Thanks! I mentioned the "legitimate accountant" so it was clear my buddy wasn't just winging it lol 

I've never heard of cost segregation without an engineering firm and big fees. My buildings are small (but expensive-ish area) so it never seemed to make sense.

Has anyone ever done a cost segregation without the use of a firm that charges a lot for it? I have a buddy that's doing it himself and providing an excel sheet to a legitimate accountant. Any pros and cons to this?

My motivation is a tax bill for 2018 that my accountant just told me I owe. About knocked me off my seat. My tax rate is above what depreciation recapture is, so I'm ok with whatever the end outcome is upon the property sale (aka I am aware I'm reducing cost basis more) Thanks!

@Brent B. This is a situation where I would throw math out the window and focus purely on behavior for now. If you're serious, you need to go on beans and rice for about 2 years, and then you'll be in a super solid position to invest, grow quickly, and never look back. Year one, you should be able to knock out about all the debt. Year two, you should be able to save enough for an emergency fund and FHA loan down payment for your OWN property. Partnership for you is a cop-out for wanting to invest while broke. You've got way too many awesome tools still at your disposal to do that.

Change your behavior patterns BEFORE you sign up for a massive loan on a property in a period of time where asset prices are very high. Fear and greed are strong emotions. You're young. If you buy your first property at age 31, that ain't so bad. Don't build your house upon the sand my friend.

do you want financial peace and stability in your life? A solid foundation from which to start growing wealth through RE? If so, the answer is not to pay origination fees (and I'm assuming raise your interest rate on existing mortgage) just to shift debt from one place to another. What rate are you at now on your home? I'm going to take a guess and say that if you refinanced, you'd pay the same amount of interest and fees in the next 12 months as you would if you attacked the credit card debt, maybe even more.

April Robbins I'm assuming you don't have much of a cash cushion at all? Do you have enough equity in any one rental to sell it for enough to wipe out all your non mortgage debts and have an approx $20k cash cushion all said and done? If so, that's what I'd do. 

I would also not start a business venture in the future that involved credit card debt to fund, even if you think it's a temporary but necessary evil. Quickest way to ruin everything you've built.

Thanks Ashish!

Thanks Wayne. I was hoping for a different answer :) Oh well, I'll count my blessings. Next time I will not assume. 

I purchased a building October 17, 2017 via LLC, me 50% and one partner 50%. My contribution was 150k.

June of 2019, I sold my 50% share of the LLC to my partner for $250k (building was not sold). I received my principal back in June, and held $100k note in the property which was paid back to me on October 19, 2018 (a year and two days after purchase).

I thought I was being smart by making my gain long term, but now I've been told I'm wrong and it's all short term because I technically "sold" it in June. I'm failing to see how this would be any different than a seller financed sale that spreads cap gains over many years.

Would anyone who's confident of the answer please share? Much appreciated!

Cabinets first with strong conviction. Yes, some extra cuts, but way more stable. Not very much extra work though to do it the right way. And, if I have to guess, the floors will need to be replaced (if not at least a damaged board or two) before the cabinets do. If you lay floors under the cabinets, good luck replacing or repairing the floors without also ripping up the cabinets (and countertops, plumbing, etc)

@frankwolter

Thanks for the encouraging and insightful post. I would love to know, how much trading around of properties did you do; or did you just buy and hold almost everything? Will your strategy change during the next time properties go on sale?

I often go back and forth between keeping 70s era 4 plexes and such with long term fixed debt until paid off vs trading up to larger buildings or newer stock, as I'm younger in my journey. Either way, my goal is to own free and clear as the end game goal. 

P.S. can someone tell me how to do the "@xxxx" callout? I can't get those to work; feel free to make fun of me for it :)