All Forum Posts by: Lucy Bennet

I read Optimize My Airbnb by Danny Rusteen. It gave me so much helpful advice. My place was on a bad looking street with a drug dealer living next door and for a while there were people living in their car next to my place and then a guy living in his truck in the alley. It was not the best location and a lot of challenges. However, I continued to get raving 5 star reviews by following the advice in this book. My airbnb was a total success but I had try hard at first too.This book really helped me.

@Dave Foster THANK YOU!!

@Dave Foster one quick question, you mentioned above "And I can't count the number of times I've seen them deny a loan at the last minute because of this when people try to use primary residence money to complete a 1031 exchange."  Did you mean to say 'when people try to use 1031x to purchase a primary residence? I would not be using primary residence money but just the 1031 x money to buy a primary residence with carriage house and basement.  Just wanted to be sure I understand completely . Thanks

@Bill B. thanks so much. Yes, that part just dawned on me. The profit will be about $130k but the home price is $245k. So basically you are saying that I would have to contribute the value of $245k to the carriage house and basement(the basement will have a separate entrance and is a separate unit). The more I mull this over, the more I think it's not the best idea. And to throw another wrench in it, the separate entrance on the basement will not be put in until after we close. So they could easily say that the basement cannot count for the 1031 x as it is currently part of the house. 

@Lucas ThomasThanks so much! very helpful advice!

@Bruce Lynn thank you! this property IS in an LLC. does that change things?

@Lucas Thomas Thanks! That makes tons of sense and just the info I was looking for! I'm self employed as a house flipper and don't have a normal set salary to work with so I'll give this some thought based on what I'll think projected income will be. Thanks again.

I'll be selling my own investment property for $245k. I'm the agent representing both sides. My capital gains will be about $150k.

I'm thinking about raising my realtor fees (ie 10%-20%) in order to lower my capital gains reported.

So it would look like this:

Sale price= $245,000

Realtor Commissions= $24,500(at 10%) -My managing broker only charges me $500 for each transaction no matter how much the commission is so my splits will not change at all based on the percentage.

capital gains (figured after ALL selling costs including commissions noted above= $125,000

If I do not claim realtor commissions, my cap gains would be $150K. At a rate of 15% it would be a $3600 difference. not sure if it's even worth it but would love input. Is this a situation where it's all going to work out the same at the end? Or is this a good idea? 

More info: Also, I realize I can do a 1031X but currently that is not the route I want to go right now due to personal reasons. My realtor commissions get paid to my LLC which is an S-Corp so I pay myself a salary based on the total of the realtor fees and other flips I do throughout the year. I am able to write a lot of expenses off as I'm self employed.

I realize I need to seek help from my CPA but he is out of town. I realize you are not giving me financial advice. Just looking for some helpful insight here. Wondering if anyone has ever done this and can help me figure the details.

@Dave Foster Thanks for the input. This is probably the best advice I've heard from just about everyone I've been asking. I had a feeling this might cause problems at the last minute, which I absolutely cannot have, and everyone has been telling me to give it a shot and it will work out! But if I'm the one giving the shot, and will have to live with the consequences.I felt like everyone I had spoken to was just telling me what I wanted to hear but I simply cannot have this fall apart at the closing table and then my money tied up with the QI. Solid answers are the key--So thank you so much for the solid advice! Very very very much appreciated!

Just looking for some answers I'm having trouble finding. I'm selling a rental property, capital gains will be about $130000. This property was purchased 4 years ago with a previous 1031 exchange. Basically about downpayment at closing table. I realize I must get advice from my CPA but he is out of town this week and just need some general advice as I'm on a time crunch.

Moving into primary residence with a carriage house (CH will be used only as a rental- I will never live there). The 1031 X company has told me I can use the $130,000 towards the carriage house portion of the purchase and first must contact my CPA to write up a document saying how the PP of the entire new property will be split up as primary and investment property and 1031 x portion will only go towards CH.

So far, so good. My lender has also told me that although they will not allow a 1031 ex to be used towards a purchase on a primary residence(as we all know those are the rules), he also told me that they will NOT see the 1031 X docs and after funds for closing have been verified, they will not care where the funds to close are coming from. (ie, they don't care if it is coming from a 1031 exchange company or from my own bank). I will have enough to cover the 20% down without using the 1031 x funds.

Here is where I can't seem to get any direction on: PP for new residence is $655,000 and down payment is 20% ($130000). If I go the route of the 1031 X, then at the closing table, will I need to send in the $130,000 from the 1031 Ex ONLY???? as it will count as my entire downpayment since the bank doesn't see where that money is coming from? OR do you think I will need to send in $130,000 from the 1031 X and then an additional $130,000 towards the primary residence downpayment?

It seems easy enough as I write it out, but no one is giving me a definite YES or NO and if I'm going to have to cough up an additional $130,000 in addition to the $130,000 1031 x then I need to know for sure before I set all this up. Can anyone help?