@Stuart I thought home improvements like flooring, bath updates, appliance updates under the name of a LLC help to offset W2 income besides the liability part?

Tricky, to get people to move in, it would need to be accessible to transportation, town...but the city has not accepted them so much legally as a living space.  

Bonus depreciation is just a special part of the US tax code.It allows you to take accelerated depreciation on portions of your property depending on when an asset is put into service.At the time of this writing, you can write off a huge portion (60% in 2024) of many qualified components that have a useful lifespan of 15 years or less.That means a certain percentage of things like landscaping, sidewalks, latches, appliances, fences, certain flooring, etc is depreciable in year 1.The bonus depreciation rate percentage changes yearly depending on the administration and the tax code.For years 2015 through 2017 first-year depreciation for all the items on a 15-year schedule or less was set to 50%.It was scheduled to go down to 40% in 2018 and 30% in 2019 and then 0% in 2020.But then Trump got elected, and he enacted the Tax Cuts and Jobs Act.That moved the bonus depreciation percentage to 100% from 2017 to 2022.In 2023 it went down to 80% and it’s currently at 60%.Depending on who gets elected again, 100% may be back on the table.Only time will tell.We know that the US government wants to incentivize more development and ownership of RE.They want Americans to continue to build and maintain our physical world.That’s why real estate is one of the most tax-advantaged assets in the US.Depreciation and bonus depreciation for RE are very positive and will likely continue in the years ahead.

Updated kitchen, bath, floor, appliances, paint, backyard.

Hi Hana,Your experience, while frustrating, isn’t uncommon in the DSCR loan space.

So, I tried to help the situation by getting a contractor to go replace the floor and remodel the bathroom so that the house is nicer for her.

Floor rate is currently 5.25% with a large buydown. 

I don't use BP much since I'm in Subto and usually in that space, but if you're doing deals down here let me know! 

The tenant fails to pay their last month's rent and leaves the place needing new flooring and paint.

And also the contractors - they know what it costs to replace a floor with LVP per sq ft.