Yes, component segmentation can allow you to take a larger depreciation deduction in the early years of property ownership, but if you never sell the property the total depreciation allowed over 27.5 years with component segmentation will be the same as the depreciation allowed without component segmentation.

I have tried to make it a practice (recently) of giving something away whenever I have come into some unexpected cash.

Every flip we do, there is something unexpected that happens, this usually costs money.Most HML these days want 10% in the deal.

If the cup says "Hot" take it literally stupid.10- smaller government.....11- Less taxes and insurances "requirements" to small businesses- less government restriction on what my business can write off as an expense and why do i have to pay workman's comp on a stoner who is going to fall off someone's roof someday anyway?

This way the GC can easily bid out each part of the job, and get me a bid much more quickly than if he has to consolidate based on my "room to room" list of things to do.I'll then have my GC give me a labor bid broken down into the following components:- Permits- Demo/Dumpster- Foundation- Roof Framing- Roof Felt/Shingles- Siding- Gutters/Soffits/Fascia- Decks/Porches- Landscaping- Doors- Windows- Wall Framing/Sheetrock- Electrical Rough- Electrical Final- Plumbing Rough- Plumbing Final- HVAC Rough- HVAC Final- Kitchen Cabinets/Countertops- Bathroom Cabinets- Bathroom Fixtures- Interior Paint- Exterior Paint- Carpet- Hardwood- Tile- Vinyl- OtherOther could consist of anything from install mini-blinds to replacing outlet covers to installing appliances.This generally gives me (and the GC) enough detail that the job can be accurately estimated, and if things change (or surprises are found), we can adjust individual areas accordingly.This also gives me a good idea how much each of his subs will be making, allowing me to figure out what his profit margins will be -- giving me some negotiating help if needed.If your contractors have an issue with filling this out, try telling them, "My lender is requiring me to break it down this way in order to approve the loan."

I'm trying not to be discouraged...And I certainly don't want to jump just because it seems like a good deal...I think the part of my equation that I'm not factoring in is this:If I get the home at the rate I hope (60k) and I borrow 80k that will leave 20k in reserve.10k I will keep untouched for unexpected things.

lol :oops: Hey don't feel bad it happens to the best of us in real estate always expect the unexpected it's an unpredictable game.That is why homeowners and investors always have to work hard to stay one step ahead.

I'd be especially concerned about areas that have a strong retirement component.

I want to make sure I am allocating enough for that unexpected expense.

Negotiating...I believe if more wholesaling "gurus" emphasized this tactic, there'd be less stress and heartache for wholesalers..Let's face it, some people who get into real estate via whatever strategy aren't great ...