If LLC member passes one of the three tests, they are considered materially participating and loss will be deductible against other ordinary income even if they have limited interest: Limited partners are deemed to materially participate in a partnership's activities if they satisfy either 1) the hourly safe harbor test (500 hours)2) the historical participation test (Historical Participation.

Venture beyond the ordinary, and let your investment become the key to unlocking Roane County's best-kept secrets.

Hi Richard, generally, from  a tax perspective buy & flip activity is taxed as ordinary income and not capital gains.

@Brit F.

Hey @Andreas Heinemann,I would link up with @Brit Foshee.  

., RI doesn't recognize capital gains and considers it ordinary income), being mostly business unfriendly, and no real engines of economic growth.It has been doing "generally OK" over the last couple of years but my impression from researching other areas of the country is that other parts of the country are doing MUCH better and currently have much better longer-term prospects.My standard advice to anyone is that if you're already in RI for some other reason, it's certainly possible with some hard work to eke out an OK real estate investing return, but if you have any choice at all I strongly urge you to research other, higher-economic-growth and more-business-friendly, parts of the country. 

I personally send a move-out letter about a week later that explains the move-out process, gives them a cleaning checklist, explains the difference between ordinary wear-and-tear and unclean/damaged, and it explains when they can expect the deposit back.

This is passive RE income, which (other than screwing the middle class) is the only reason I can come up with why the tax law is structured this waySo...max out your 401k, HSA, 529 or state education plan, Roth IRA - then get onto RE - all "necessary and ordinary" expenses can be deducted.

I agree Glen; Dave Ramsey provides good advice for the novice investor to get out of ordinary debt but didn't follow that path for his massive wealth building.I am curious if there is a calculator out there to determine where the "break even" is on a refi. 

If you cost seg and bonus, then sell it two years later, you have ordinary recapture and much less potential capital gain.3) You don't have to bonus all asset classes, be selective.4) There is an assumption when you are presented the potential benefits by the vendor that you will hold it until the end of the class life, which could be 27.5 or 39 depending (possibly unlikely)5) Even if you bonus it or 179 it (together potentially), the deductions might be so much greater than the income it gets suspended at the activity level.