All Forum Posts by: Stacie T.

Just to clarify, are you looking for a portfolio lender, as in a bank or credit union that keeps loans in-house?  Or are you looking to put several properties on one note, i.e. a blanket loan?  Portfolio lenders are generally smaller banks and credit unions, there are likely a bunch of them in your area.  Blanket loans make for less paperwork and potentially some cost savings, but they can be problematic if you look to sell some (not all) of the properties secured by the note.  

I had a list. Let me know a few you have found and I'll share mine. Obviously it's all connections because if I start referring any bozo then it reflects badly on me.

Stacie,

If AGI is higher than $150,000, you still calculate your net losses with rentals in the same way.  The same deductions are allowable for you.  The difference is then, if you end up with a net loss after all your calculations, you do not get to deduct those losses IN THAT YEAR

Here's how it works.

1.  You calculate the gains and losses on all of your properties.  And gains you have on any of your properties are netted against the losses in other properties.  If the net result after adding all gains and losses together is a gain, then you pay tax.  If you have a loss, move to step 2.

2.  Net your rental losses against other Passive Income.  If you are a passive investor in a partnership, have royalty income from gas wells or authorship or any other Passive Activities, then this counts.  If the net is now a gain, you pay taxes, if you still have a loss, move to Step 3.

3.  Passive Losses that you are unable to declare due to your income accumulate indefinitely!!!  Next year, you do steps 1 and 2 again.  If the result is net gain, then you can pull in passive losses from a prior year to pull those gains back down to zero.

4.  Or, if your other income is now less than $150,000, you can write off your losses from the prior year in the current year.

5.  If you never have passive gains and your income never goes below $150,000, then the losses still are not "lost".  When you sell the property, all of those trapped passive losses are released on the date of sale and you can write 100% of all your accumulated losses off against the current year income, no matter how high it is.

Hope this helps.

@Stacie T. what I've learned is that you CAN depreciate the asset in order to offset your total rental income you need to report.  But what you cannot do is use to offset all your other income from your 9 to 5 day job.    

Nothing could be further from the truth. There is literally no difference on your tax return if you hold your properties personally vs in an LLC. The structure, and even the forms used, are exactly the same. There is nothing that an LLC gets you from a tax standpoint that you don't get when you hold the properties personally.

Holding property in an LLC is purely an asset protection plan, not a tax structure plan.

It's possible to have a difference between cash flow and profit when you factor in Capital Expenditures and Mortgage Principal paydown (which affect cash flow, but not profits) and Depreciation (which affects profits, but not cash flow)