All Forum Posts by: Cameron Skinner

@Brian Eastman

OK so how do I handle distributions?  Is it possible for them to be unequal distribution's. For example I put in 50% of the money my 401(k) putting 50% of the money my partner 0%

Give my partner receive 20%, then my 401(k) receive 40% and I receive 40%. 

@Account Closed

Just go to Sunbiz.org  that's the state Department of corporations website.  You can do everything online. 

OK question for the solo 401k experts?  I have a business partner I've worked with in the past found a deal and it's really good commercial remodel, then sell.  He will do 100% of the work for a % of any profits.  I don't have enough in my Solo 401(k) to fully fund the deal.  

1 Can I create an LLC my partner would be the managing member 20%. The remainder 40% interest me 40% solo 401k. I will do no work except keep the books.

When you buy a piece of equipment or a car for your business irs dose not allow you to expense it all in the first year because it is an asset not an expense.  Depreciation is just a way of you to expense a business asset as it wears out over time.  Irs allows you to depreciate a car over five years we all know It can last much more than that especially if you maintain it.  Accelerated depreciation has always been a tool by the government to encourage people to invest in equipment and even real estate.  It even used to be more lucrative back before 1984 tax act. 

Homes like anything else wear out and the structure will eventually become worthless.  Unless you completely remodel the home and then new depreciation starts on value of the remodel.  Homes tend to increase in value even as the actual structure goes down in value this is because of inflation.  Try selling a similar size home that was built in the 50s and has never been remodeled compared to a brand-new home.  

Hope this helps good luck

@Adam Craig

In Florida it only cost about $120 to set up an LLC and then $75 a year to file the annual report. IRS allow you to treat LLCs as a "disregarded entity" So you can file them on your schedule e on your personal return, so there is no additional compliance cost. It's a relatively cheap effective asset protection tool.

Hope this helps good luck

hooah!

It won't effect you at all with your taxes, out of state entities own properties in other states all the time.  You will have to pay CO state income tax on any income attributed to the CO property.  Since FL does not have a State Income Tax you don't have to worry about that. And of course you will have to pay Uncle Sam but he doesn't care what state your in.

Hope this helps 

Good luck! 

In regards to the LLC depends on how much equity you have in each property. If you are sued within the LLC they will have to sue win get a judgement and then foreclose on the individual properties, and pay off the loans. I have multiple LLCs being carful not to have more than about 40-50k "equity" in each LLC. You probably have liability insurance with your normal fire policy per dwelling usually 250k or 500k. Also your property management company should have a liability policy as well. Umbrella policy might be overkill, depending on your other personal assets and State laws regarding what assets are judgement proof. Because your much more likely to be sued running someone over in your car than a rental house falling down on one someone.

Hope this help

Good luck 

@John Powell

Yes as long as you hold the property for at least 1 year and one day after you place the property into service "available to rent" any gain on the sale will be treated as long term capital gain.

Hope this helps Good Luck!

yeah way too many moving parts and veriables for anyone to answer your question without reading the trust documents and knowing the laws in your state.

Shop around as long as you have clean books you should be more in the $400 range for a 1040 with schedule E.   I suggest you find a good licensed taxed professional in your area someone with some letters behind their name not one of those franchise types and someone who owns some rentals themselves.  Can you cost segregate to increase your depreciation?  Do your capitalized expenses qualify under the safe harbor rules?  Did you remember to write off your milage to the bank, post office, to your accountant, ect?  Can you qualify as a real estate professional, if so how do you document properly, if not what changes you need to make to qualify next year?  How do you structure new transactions to avoid the new net investment income tax?  Should you structure your rentals in a way that you can take a 179 deduction?  While turbo tax is ok for w-2 employees, real-estate tax law is way to complex for software just too many variables.  A good professional will always save you more in taxes than their fee.

Just my opinion, hope it helps

Good Luck!