One objection that is common now a days is the first mortgage rate being low and the home owner not wanting to lose that low first mortgage rate.The other objection is they want to use the Heloc like a credit card only making a payment on the portion that they use rather than the full amount.

The vast majority of states also leverage figures on a federal return as a starting point to define taxable income, making adjustments to those figures to arrive at the portions of income that are taxable for state tax purposes. 

This is the portion of your payments that is applied to reducing the principle on the loan versus paid to the lender in interest.

Otherwise, they will trash the property, not pay their portion of rent or utilities, and then move on to the next property.

If so, I think buying a single family home and renting out a portion of it to airbnb or a long term renter.

Hi Dave,I agree with Zachary above that it is fairly uncommon for an experienced tax professional to review only a certain portion or even an entire return someone has self-prepared.

Some of these people are defaulting on very small rent portions.

Hey Art, When investing in real estate within a Self-Directed IRA, using leverage can trigger Unrelated Debt-Financed Income (UDFI), which may lead to Unrelated Business Income Tax (UBIT) on the portion of income derived from the leveraged percentage.

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.

For those of us starting out, and looking at lower end real estate, saving for expenses will eat up a good portion of that monthly cash flow until we get a nest egg to hold, or until you (I'm in the same boat) get into more expensive/valuable properties.