All Forum Posts by: Cameron Skinner

Wow you have a mess on your hands, 

1) you should never own rental property in a c-corp

2)  you should always have you primary residence in your own name.  

This is too complicated for me to help you unwind on a thread, private message me if you want and I will send you my contact, because I would need a lot more info from you to see if I can help, or at least point you in the right direction.  

Anyone know a good builder in the Orlando area more specifically Deltona to sub out new construction, or even possibly and experienced superintendent as I'm a licensed contractor     

Yeah there is a bunch of specific tax rules when it comes to US and Canada Tax issues, because the US has a special Tax Treaty with Canada, you really need a good Licensed Tax Professional who specializes in real estate investors and foreign investors.  A good Professional will always save you more in Tax than you will ever pay in fees.  I'm not taking on any new clients but if you private message me I can send you a referral.

IRS allows you to calculate donations at the "fair market value" but it must in at least good condition, something tells me stuff left in an trailer for 5 years with no utilities on would have little to no value.

See excerpt from IRS Publication 561

The FMV of used household goods, such as furniture, appliances, and linens, is usually much lower than the price paid when new. Such used property may have little or no market value because of its worn condition. It may be out of style or no longer useful.

You cannot take a deduction for household goods donated after August 17, 2006, unless they are in good used condition or better. A household good that is not in good used condition or better for which you take a deduction of more than $500 requires a qualified appraisal. See Deduction over $500 for certain clothing or household items, later.

If the property is valuable because it is old or unique, see the discussion under Paintings, Antiques, and Other Objects of Art.

Used clothing and other personal items are usually worth far less than the price you paid for them. Valuation of items of clothing does not lend itself to fixed formulas or methods.

The price that buyers of used items actually pay in used clothing stores, such as consignment or thrift shops, is an indication of the value.

You cannot take a deduction for clothing donated after August 17, 2006, unless it is in good used condition or better. An item of clothing that is not in good used condition or better for which you take a deduction of more than $500 requires a qualified appraisal. See Deduction over $500 for certain clothing or household items, later.

Hope this helps good luck!

This could be really bad if creditors are going after the partner, your friend really needs to buy a couple of hours of time with an asset protection attorney, to protect his own interest in the project.

@Doron Nisenbaum, This is an easy effective way I have found for clients who don't want to worry with a spreadsheet or accounting software. I call it solitaire. Open a separate checking account for the rehab, get an account that prints copies of the the checks on the statements.  In the memo column write specific expense categories that you ask your CPA to give you like utilities, repairs, etc. At year end cut out individual checks and then just group like catogories and add them up staple individual groups together and then write down all the totals on a single piece of paper throw it in a file and hand to your accountant and he will love you.  Remember IRS does require you to keep receipts and invoices to make sure your not buying personal stuff along with your materials from Home Depot but you can just stuff those in a spot in your wallet and throw them in a shoe box at home when your wallet gets too fat, so you can go back and dig them out if your audited. I have one client who gets all his kids envolved at year end and makes a big game of it.

Super low tech, but easy and effective,

Hope this helps,

Good luck!

@Garrett Canter

OK if you want to start a huge battle on Biggerpockets start a post on this subject, I have posted on this before, many people disagree with me but this is my real life story.

So during the financial crash I'm just casually talking to a big time local personal injury attorney who goes to my church, I say well at least this down turn doesn't hurt you, he says actually it does businesses are hurting so bad they are dropping their insurance, and its almost never a feasible to take legal action if the they don't have insurance.  So I talked with an Asset protection attorney and he concurred, also there is a great book "So Sue Me" that also suggest, this tactic.  Now one thing to remember Liability Insurance will also pay legal expenses if they do move forward, but in many cases you can represent yourself.  In my case I actually new the attorney who sued me and I called him explained the LLC had no insurance and only small amount of equity.  He either didn't believe I did not have Liability Insurance because most policies automatically include it unless you purposely exclude it, or maybe he thought he might scare me and shake me down for a few dollars.  So he did sue my LLC, and I did have to "answer" the complaint then he requested copies of all insurance policies on the property during discovery, once he realized I didn't have any liability insurance he dropped the suit.    

Any way just what ha worked for me, hope this helps good luck       

@Mylene Bel, The IRS publications state if you are a non-resident alien and have any US source income you are normally required to file a 1040NR, now there are some trade agreements with certain counties and other variables, but this is why I suggest a Tax expert who specializes in this type work. 

Again, not knowing your specific tax situation Capital gains is usually 0% up to certain threshold amounts depending on several variables.  You are probably only looking at $300-$400 for a Tax expert to handle this transaction correctly from the beginning, but if you start trying to transfer the property or handle it incorrectly it may end up costing you several thousands after the fact to unravel a mistake.  

Hope this helps Good Luck  

@Garrett Canter

If you have loans on the properties 4 separate LLCs is overkill, remember If your LLC is sued they can only go after any equity in the LLC, and this is the "fire" sale value of the property minus the mortgage, because the mortgage has first lien. Don't forget they have to sue you win, get a judgment then forclose, almost all these cases are done on contingency so no attorney will even look at it unless you have allot of equity in the homes. This is from a guy who loves him some LLCs because I had one of my LLCs sued when one tenants dog bit the other tenant. Case was dropped once the attorney realized I didn't have Liability Insurance, and loans on the property. Even if you have 100k in equity An attorney is not going to risk tens of thousands in legal work to for a remote chance to get 33k contingency.

Hope this helps good luck!

@Mylene Bel

@John Thedford is correct, any transfer now would be a huge mistake, but it's not as bad as it looks this is just withholding, when you file your 1040NR you will only pay tax on any profits (net sales price less net purchase price)*  and there is a good chance depending on your specific situation, as long as you have held the investment for over a year you won't owe any capital gains tax unless your profit is over 75,300 married filing jointly. Now I am assuming a lot of variables such as you don't have any other US income etc.  I'm not taking on any new clients but If you private message me I can give you a referral really good CPA who specializes in foreign real estate investors.

Hope this helps good luck

*I'm assuming you didn't rent the property, if you did you would also need to recapture depreciation