All Forum Posts by: Sachin S.

Thanks, Michael for offering to help the community for free, appreciate your time. Best advice in life are "free" , when made with good intentions. :) (Surgeons or Tax Advisors, profession no matter)

Thank you @Michael Plaks for the prompt response. A follow-up question: If I get the cost-segregation study done in year 2025, will that help ? (provided my spouse also get REPS in 2025)?

750 hrs as REP and 500 hrs materially participating in property, Yes, I understand those requirements. My question is more towards carry-forwarding passive-losses of LTR from previous years (when we are not a REP) towards now offsetting active-income in the year one of us turn REP. 

Hello BP Experts, 

Let's say I acquired Long-term rental properties in 2024 and got the cost-seg/bonus depreciation study done for those properties in the same year. My understanding is  that these losses would remain passive-losses (if neither myself or my wife is claiming Real Estate Professional status for year 2024 when filing our tax-returns).

However, If my wife claims REP status in the year 2025 (she will work as Real Estate agent, materially participate, etc in managing these LTR
properties for 500 hrs, etc), can we carry forward the passive-losses from bonus depreciation from 2024, towards offsetting my W2 income to be earned in the year 2025?

I came across this link: https://semiretiredmd.com/primer-real-estate-professional/  where they say the answer is NO, I just want to validate my understanding, quoting relevant section from that link:

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"We often get the question – can you claim these suspended passive losses during a year you become a real estate professional? The answer is “no.” The reason is that these suspended losses are passive and they can never offset non-passive income like income from your clinical job, only passive income.

So it makes sense to be strategic and time your losses so they coincide with the year you become a real estate professional."

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Just for comparison, I am curious to know the prevailing A-I-O loan interest-rates for a typical borrower with 720+ credit score and respectable LTV.. ?

Hello BP STR experts,

If I buy land first for constructing/manufacturing home, can I then claim bonus depreciation for such a constructed/manufactured home and use that calculated depreciation amount to offset my W2? 

Note: I am under the impression that me material participating in this exercise will fall under the "Real Property Development or Redevelopment" activity, thereby allowing me to cost segregate the home construction cost.

Let me explain with example:

- Assume I purchase land worth 50K in August 2024, and then hire contractor/architect and spend over 100+ hours discussing the building plans, etc to either construct a SFR home or a Manufactured/Mobile home.

- I will also supervise the construction and other related activities (but will NOT build the house myself) .

- Let's assume the total cost of construction is 200K (or 150K if it's a manufactured/mobile home).

My Question would thus be- 

Can the STR tax loophole strategy allow me to offset 60% of the 200K amount that I paid towards construction of the home, (or 60% of 150K if it's a Manufactured home)

Any success stories with this kind of approach?  

 Thank you for the response. Yes, it will be a partnership with myself/spouse as members and we file MFJ. 

 @Kelly O'Keefe I would be interested in the tracker.. would it be possible to share/inbox it ?

Hi,

Can STR purchased under LLC ownership offset active W2 income of the members of the said LLC?

I plan to do cost seg study and get bonus depreciation (and will actively participate as per IRS rules) but need to confirm if this would still work if buy STR under LLC and I can still be eligible for that STR loophole?