The cost basis includes:Purchase Price: The amount you paid for the property.Renovation Costs: Add the cost of improvements and remodels that significantly enhance the property's value.Closing Costs: Certain closing costs related to acquiring the property (like title fees) can be added to the basis.You will then allocate the total cost basis between the land (which isn't depreciable) and the building (which is depreciable over 27.5 years for residential properties).If you're unsure about how to allocate between land and building, you can use the allocation percentage from your property tax records or get an appraisal.This post does not create a CPA-Client relationship.

The regulations allow for STRs so long as you get an annual permit ($300) and pay 3% local occupancy tax. 

Property taxes in Columbus were re-assessed in January of 2024.

Cost segregation can help boost cash flow, create substantial tax savings, and increase the profitability of the warehouse operation by accelerating depreciation.A cost segregation study is a strategic tax planning tool that separates the assets that have a shorter useful life and can be depreciated over 5, 7 and 15 years from the residential rental property or nonresidential real property that are depreciated over 27.5 and 39 years, respectively.

From a tax point of view, is it possible to move his money from his business account into a real estate purchase without paying tax on the money from his business account?  

What are the potential tax implications ups and downs of transferring the residential property to business ownership and then acquiring debt on it?

@Kent Ford Taxes can be outrageous in Texas.

The first mortgage, taxes, insurance, etc on this property have all been paid as agreed during this time.

How are you generating steady cash flow, benefiting from appreciation, offering tax advantages, and diversifying your investment portfolio?

If you need tax planning or preparation services, please don't hesitate to contact us or DM me.