All Forum Posts by: Kenny M.

@Kenny D.

Is there a particular reason it's set up as a C Corporation? Typically for real estate it makes more sense to hold investments in an LLC (whether disregarded or a partnership for tax purposes). The basis rules associated with Opportunity Zone investments make it even more important.

@Matthew Ryan

Agree with Matthew here. I am located in Birmingham and our entire downtown was designated an OZ. It covers pretty much all of the areas that were already being developed.

At minimum, you could set up your own OZ Fund within 179 days from your gain event and put your gain money in it, then buy yourself another 6 months (or more depending on timing) to find an investment. It’s flexible because you don’t certify an entity as a OZ Fund until you file the tax return for the entity. If you don't find anything you like in an OZ, you just pull your money back out, don't file a Form 8996 certification and pay your gains taxes. Keep in mind the OZ Fund does have to be an entity taxed as a partnership (or corporation) though, so it will need a member other than you.

Guys, are you aware you can report the damages and eviction to Section 8?  We have been 'successful' in having a few Section 8 tenants lose their vouchers.  No, we were never made whole on the expenses, and I'm not a vindictive person, BUT, I felt it was my obligation to work the system.  People who need assistance should have it;  those that abuse that gift should not.  

"Don't bite the hand that feeds you."

 Depending on what size you are looking for there are still OZ deals in Harlem, Bronx, and Westchester. I’ve seen deals recently in the $3-15m space. But than again the OZ requirements might be too expensive in the lower end. Haven’t run the numbers myself to dig deeper yet.

@Kenny M. - I know better than to fight ones perception. Only thing I'll say is I would challenge you to not discount all OZ's. We set our fund up in #1 OZ according to Fundrise. There's OZ's in downtown San Jose, Downtown Berkeley, etc. Some of these are areas that are seeing institutional players move-in and while I don't like to elevate them as the wholly grail of all decision making, they also don't chase poor tenant profiles ;) 

I had the same problem with an unwed Section 8 Tenant and her SIX kids. Totally destroyed the house to the point it was deemed Unsafe and she was locked out Feb 5, 2019 (long story). I am still repairing all the damage (upwards of $60,000). On Tuesday 6/12/2019 my contractors were working on the house. The former tenant showed up and barged into the vacant house which was under construction. The police were called. Evidently she and her spawn have been living in a motel for 4 months since no other Landlord wants them. She won't get out of my life. She's the gift that keeps on giving.

@Kenny M. do you have a judgment against the tenant for the $9K?  If so, you can record in both NY and NJ (record in county where she lived, and county where she now lives).  You may then be able to start the process to garnish wages, depending on her current residency state laws.  By recording the judgment you will put other landlords on notice, and it will show up on the tenant's credit report.  

This is not legal advice, but a garnishment is very different from a collection effort.  Check NY and NJ laws.

@Kenny M.

I own properties in CT and my property manager will send past tenants that owe money to collections. The chance of you receiving any money is very minimal. As you have found, most attorneys are aware of this low chance of collection and at this point it might be considered throwing good money after bad. Personally, I would tighten up your background checks, which will not solve all problems or find all problem tenants, but it will minimize the chances of this happening again.

@Kenny M. - I don't pretend to know more than anyone :) You should look at Opportunity Zones. More flexible terms for re-investment (full 180 days) and if you keep the investment for ten years, you alleviate capitla gains on all appreciation. If you've got that much dry powder I think it makes since to at least consider an allocation into an OZ based investment even if it is late in the cycle. If you're looking that far out and the deal makes sense, the additional buying power (cash) is huge. Especially in a 28% fed tax bracket.