All Forum Posts by: Kevin D.

Hi all,

I'm considering some buy and hold investments on small SFR units in Indy and would appreciate some input on the neighborhoods I'm finding units in.

I believe the neighborhood is referred to as Bates-Hendricks and the units are all north of Raymond Street, east of Madison and west of I-65.  I'm hoping these properties to fall in a C class neighborhood...looking to avoid bullet holes and "war zones".  From street view, looks promising but would love to get insight on the neighborhoods from any PMs, Agents, or other investors in the area.

Thanks!

@Chad Hale thank you Chad!  

@Steven Hamilton II Funny you notice my timing.  Funny story, we had a weekend set, first weekend of April to wrap up all our docs and go to a tax pro we used once before which was supposed to be two weeks ahead of our first daughter's due date.  THEN nature had another plan for us and my wife went into labor that preceding Friday night.  There went our plan and we've been in a sleep deprived, poopoo and peepee obsessed state ever since.  Couldn't be happier of course and happy to say she is healthy and happy but she cares none of our tax deadline!  LOL, anyway, happy we have BP to connect us to the true pros out there!

@Chris Mason The Great Swammy knows all!  lol  That was a nice little jolt this morning though.  We like those little, "pressure releases" here don't we?  

@Ashish Acharya thank you for such an informative response.  I believe I see the correct way through this.  

Please direct message me if you are currently taking on new clients for CPA/tax prep services.  

Thank you,

Kevin Dupuis

HI Marcy and by the way, nice to hear from a fellow south bay'r.  Yes, the large deductible is what has me questioning the coverage.  I failed to include in my original post but just looked it up and it's at $50k.  We at first felt that why would we not just roll the dice since it'll cost us $50k just to file the claim should a major quake occur.  However, applying a simple probability cost to it (probability x cost of event) if I use assumed probability of the event as 63% chance for major (6.7 magnitude or higher) quake in the next 30 years (http://www.earthquakesafety.com/earthquake-faults....)
 and the $300k replacement value and I arrive at a risk cost of $189k.  Comparing this to the minor cost of annual premium x 30 years plus the deductible it costs $63,500 to cover a $189,000 risk.  Not the greatest "pot odds" but not bad.  

If anyone has another way to look at this, please share.  

My wife and I self manage our California rental property but spend no where near 750 hours per year doing so. We are W2 earners with over $200k combined income.  Since we don't meet the tax law criteria for "Real Estate Professional" it seems that Turbo Tax disallows a significant amount of loss write off. Is this correct? If so, this seems to drastically diminish the benefits of real estate as an investment. Unless I'm missing something, if I can't write off office space, mileage, business meals, etc. then I'm losing a lot of revenue with no tax benefit. 

Hoping to better understand the implications of this and adjust our expenditures for future years accordingly.

My wife and I are regrettably taking a DIY approach to taxes this year (probably the last year we'll do this!) I'm seeking tax tips for depreciation on an SFR that was purchased in 2014 as our private residence then converted to rental in 2016

Details:

• Purchased in 2014
• loan was refinanced in 2015  
• We began depreciating in 2016 tax year, the year we began renting the home as landlords
• tax preparer for 2016 taxes entered basis amount based on 2015 assessment, not assessment from purchase year or for the 2016 assessment
• unsure if bases was set correctly and whether to carry through that same basis or pull current year assessment for this and subsequent tax years
• Turbo Tax seems to be steering me towards using the purchase year assessment for the basis for depreciation.  

My question is this:

What year assessment should I be using for the basis for depreciation?  The year of original purchase (2014), the year of the refinance and year my tax preparer used in 2016 taxes (2015), the year we began renting the property (2016) or last year's assessment and each subsequent re-assessment?  

Thanks!

I've seen some nice posts and discussions on earthquake insurance but still haven't seen the answer come clear for my property.  I'm hoping for some feedback.

My property is a SFR in Gilroy, CA. Note, this is not "on" an active fault line but not far from several VERY active seismic areas (Hollister 20 miles to southeast and Luoma Prieto near Santa Cruz roughly 40 miles to northwest). The house is technically a "Jack and Jill" or "attached single family". It shares one common wall with a single adjacent unit. Separate ownership, title, everything. No HOA, just CC&Rs for common areas.

Property is worth roughly $600k.  Structure valued at roughly $300k.  Debt is roughly $390k.  Rent income is currently $3k monthly.  (I know, not a big cash flow property).  

So my insurance agent has quoted $450 annual for earthquake insurance.  

Given this, does earthquake insurance make sense?  Are there things I should research regarding fault zones?  Obviously it's somewhat subjective based on my risk tolerance but there must be some logic to this that is objective.