All Forum Posts by: Taylor Brugna

@Tom Mitchell Turning a vacation home into a rental is a good strategy to be able to take the property tax deduction as a business expense, and therefore will not be subject to the 10k limit. You would have to rent for more than 14 days a year, but keep in mind that the whole property tax amount won't be counted as a business expense, the tax is allocated by the portion of the year the property was used as a rental. 

@Cassandra Popli The rent you pay is an ordinary and necessary expense for you to rent the property. You can't obviously deduct your whole rent payment, but for the days that it's rented it would be valid. 

@Cassandra Popli This definitely needs to be reported, doesn't matter if a 1099-K was received. 

@Chris McHaney 

1)When making the transfer to the "escrow acct"-Debit Escrow/ Credit Operating Acct

2) When actually paying taxes insurance- Debit Insurance Expense Credit Escrow Acct. 

On a separate note, you should try to avoid JEs for stuff like this because it is not the best way to keep a "trail" in the system. QBs is very form based and has many features that will keep better track of transactions than a JE will. I try to only use JEs to make year end adjustments such as depreciation or if I didn't property record my amortization on a mortgage. 

@David Besins Holdings rentals in an S-corp would still create significant basis issues, and would not be the best option. Sole props/SMLLCs can still take this deduction. If your income is over 315k, you would just take 2.5% of basis instead of the 20% deduction. 

If the portfolio taxable income is going to be that high (after depreciation), you may want to consider cost seg studies and other strategies to reduce the income in the current year.

Hope this helps!

@Chris M. When you file form 2553 it will affect all of 2018. What type of business are you running? You will eventually have to get payroll set up to take a reasonable salary, as you suggested. Highly recommend using a payroll company that handles payroll tax filings as well, it will save you time! 

https://www.nytimes.com/interactive/2014/upshot/bu...

@Xiang L.  Welcome to BP! This calculator does a pretty good job. How long will you be living NYC? This is one of the biggest variables due to the high transaction costs of buying/selling. You could also consider buying a multi-family and living in one of the units and renting out the rest if your budget allows. 

@Neems Y.  The best advice I have for you is to move :)  Florida, Alaska, Nevada, South Dakota, Texas, Washington, or Wyoming  

2) Downsize your house-potentially less property tax and mortgage interest that won't be deductible

3) Prepay your property taxes on your primary residence * if already assessed and not in AMT

4) Max out tax deferred retirement accounts 

5) Increase charitable contributions

6) Find a good CPA to figure out the rest 

@Brandon Smith There is a wealth of information on the site for free, but check out the BP books in the store as well. They are great resources and a good place to get started. I'd recommend focusing on school, learning about RE, and building up some savings! 

@Jim MacBean Where in Long Island City are you from? I live in the Hunters Point south area by the park. Welcome to BP, replacing active income with passive rental income is a common goal around here, and many people have seen success!