All Forum Posts by: Veronica Ivy

I thought being an 'active' real estate investor, including rental income, does make a huge difference:

Real" class="redactor-autoparser-object">https://support.taxslayerpro.c... Estate Professional

Activities of real estate professionals are not treated as passive activities."

Further:

"Real property trades or businesses include property development, redevelopment, construction, reconstruction, acquisition, conversion, rental, operation, management, leasing, or brokerage trade or business."

No?

Oh yes, I'm entirely aware that I can't lay a finger on the property to do any improvements. I have a whole team of people to do that work without me (a residential builder/remodeler, plumber, electrician, handyman, junk removal, etc.). The rental housing company pays them and I coordinate.

For the Solo 401k, obviously the payments will come via the 401k account ONLY. The 401k held properties will be treated totally differently than my other held properties (5 SFHs).

I've looked at the tax requirements, and I think that I'm involved enough with my rentals to qualify as a real estate professional, which means it's active, not passive income. No?

So I could have my FFH LLC that owns 4 of the properties create the Solo 401k and write it off as a business expense?

Yes, remodeling. I do actively repair and remodel my rentals. My remodeling LLC is separate from the LLC that owns the properties.

OH. So it's the Self-Directed IRA that needs an LLC, but the Solo 401k doesn't need an LLC?

So my paying the set-up fees for the Solo 401k are tax-deductible on my personal taxes as 'legal fees,' I imagine? Or should I have my rental property LLC pay for the set up and deduct that way? The LLC is single member and pass through, anyway.

But they'd only be deductible for the Solo 401k LLC, which doesn't have to worry about taxes, right? Or can I somehow claim them as pass-through on my personal return?

Yes, I have 3 self-employment businesses.

Question: is there a way to use the Solo 401k set up fees as a tax deduction?

I thought a lot of y'all's companies set up the bank account for me and the LLC as well, no?

Perfect! That's what I was hoping to hear. We might be in touch :)

I actually have 3 self-employment businesses that generate gross income.