Cheers for this, been searching for "passive income investments" for a while now, and I think this has helped. You ever tried - Qonmily Passive Formality - (do a google search ) ? Ive heard some amazing things about it and my brother in law got excellent success with it.
@@RedactedNews Would I have to take a loss if I pay cash for a property? Or can I write off most things and not have to pay any tax on the rent money I get from tenant?
Hey, can you claim a tax deduction on the land you rent to park your RV on each year and it's considered your primary dwelling spot? The Rv is also fully owned by me. Is this allowed?
@@johnvigil8440 Dave Ramsey would never give advice like that. His advice is stick to beans and rice, cut up credit cards and buy rentals with cash…. He’s a clown
I'm new to RE investing but I will always remember that quote "If you're paying any taxes as a real estate investor you're doing something wrong" That quote will be in my head every year at tax time during my RE investing journey to guide me in doing this right. Thanks.
not a CPA but most times if the contractor can split the bill in Labor and materials you should be able to list it in the first year but check with your tax adviser or require the total roof repair to be made in 3 separate repair bills for 1st or 2nd year recoup. just saying
Your accountant is correct... Below is an great example I found: The basis of property you inherit is usually the property’s fair market value at the time the owner died. Thus, if you hold on to your rental property until death, your heirs will be able to resell it and pay little or no tax-the ultimate tax loophole. Example: Victoria inherits her deceased parents' home. The property’s fair market value (excluding the land) is $300,000 at the time of her uncle’s death. This is Victoria’s basis. She sells the property for $310,000. Her total taxable profit on the sale is only $10,000 (her profit is the sales price minus the home's tax basis). The basis of a home or other property you receive as a gift is its adjusted basis in the hands of the gift giver when the gift was made.
I'm going to take a class on preparing taxes, and there are about 6 levels to achieve to be a professional tax consultant. This really is an eye-opener for me. Thank you 😊 so much?
I was just listening to the Rich Dad Poor Dad podcast on depreciation and searched on youtube for more elaboration and it was Morris invest who they were speaking too.... so wow small world. Thanks for the valuable video!
The FICA is what kills me lol. I have a small office rental. It brings in $32,000 a year. I pay the triple nets, dumb i know lol. After deductions im around $22,000 self employment income. 15.3% of that is still a lot.
I own commercial real estate, so I am familiar with depreciation. Repairs and improvements are different things. It may well be that the IRS is not a stickler about these, but they are distinctly different and it sucks for me to have to pay for a buildout for a new tenant and not be able to claim it right away, but have to amortize that expense over the life of the property.
It benefit you because Capital Improvements even though they are depreciated they reduce your taxable income But A mortgage lender can add them back in to your qualifying income to help you buy more property
Replacing a roof is not an expense, it is an improvement that extends the life of the property and a s such must be depreciated of 27.5 years and not expensed in one year. A small portion of the roof can be repaired and be claimed as an expense. Ithe IRS ruling is that if any work restores the property or extends the usefull life of the building, it must be depreciated not expensed. Meals can only be expensed up to 50%
@@dropoutandretireearly1781 If that's true, that's great to know, I'll be asking my accountant. I know a lot of real estate investors and I have never seen them do their roofs in different time frames.
You can only save on taxes for the income from the real estate property. which means if you have a regular job, you still have to pay taxes on those income and you cannot claim rental expenses to reduce your taxable income that came from your regular job
Roofs are considered an improvement (as an a capital improvement) & therefore Subject to the depreciation table not as a wholesale whole number deduction.
From talking to my friends that own rentals that your better off buying a multi unit rentals like a duplex I currently own a single family home as a rental
I was wondering how deductions apply to purchasing a new property. From what I understand, you can’t deduct start up costs. Is this correct? If so, if the previous tenant is in the house after you close, and move out after a few days, are you then able to write off start up costs? I’ve also read where a loophole is to list the property for rent day one, even though it’s not ready to be rented.
So I have a 9-5 job and I'm at a high tax bracket. My personal income tax is usually around $20k. Will investing in real estate offset my personal income tax or is it just for taxes in the real estate business?
Print off a sch e and it will list your real estate expenses. An 8829 also if you use a home office. I forget but i think an llc is a 1065 partnership return. Not sure but if you make an llc you will report your real estate there. Key though get a sch e form.
The mileage credit is ridiculous! For example, I know people who use a service to accept rent and of course there's a fee. I have 3 local properties so I can drive, pick up the rent, and stop in the place I was undoubtedly going to drive to anyway for lunch because it's on the way. Now instead of paying a service 2% or 3% I get all of the money, an opportunity to visually inspect the property (last time on one I realized I need to clean the gutters), and the drive itself becomes a profitable trip at tax time.
You don't need to have a business to own Rental Property. Altho some Cities requires a Business License such as Central, S. Carolina. Some cites don't require a licenses but require you to pay a fee on the refrigerator, washer, dryer which gets depreciated until zero like Lehigh Acres, FL. Some cities don't require anything like Benton, AR or Lawndale, CA.
Thank for your videos!! I recently purchased my first property and am renting it out while traveling for work. This is my first year owning a rental, so I only have one. I am trying to figure out how to do the taxes myself and am unsure about what to put for depreciation. This is my main question right now. Does the 27.5 years start the year you purchase? Do I put $0 in those spaces for “before and after 1997” since I just bought the property? Or do I have to calculate it using the fair market price/appraised value? So many questions. Thanks!!
All this applies to a single home 🏠 and I just buy another single home which I’m living in it any reforms or additions like a privacy fence counter tops...etc would that add value to the house and I assume since I’m living in it I won’t be able to claim it on this years taxes?
I have a question that i look all over the internet and i cant find the answer. I hope some one here have the answer . The depreciation is calculated from the money ypu have left after expenses like mortgage and water bill . Example I charge rent 1k per month x 12 is 12,000 a year ypu use this amout or you use the amount left after expenses like i charge 1k per month but i pay 50 for water and 600 fpr mortgage i have left 350 per month x 12 is 4,200 per year. Which one you use yo calculate depreciation please some answer ???????
I plan to buy another house and rent out my current home. Can I put it in an llc and write off the repairs it needs to get it ready for a rental. Repairs are minimal painting, deck repair and new roof.
So glad i saw this, have neen doing this on my personal taxes since our first house became a rental. Inly one i need to keep better track of is my mileage when i drive by to see how the place is looking.. thanks for the list
1. How do u get properties on LLC / Corp. 2. How to make the bank do that as in most of the cases they don’t agree on this as the mortgage is taken in the name of the owner / spouse .. 3. Is depreciation on asset mentioned by u applicable in Canada ... thanks
I recently created an LLC, for a reason other than property ownership and only lately decided that i wish to buy and rent out homes. My question is should i buy those properties under the said LLC or under my personal name. Thank you
Can I as an investor of a rental property write off expenses for initial rehab of a house and the contractor’s work on the house? Your videos have been extremely inspiring and informative. Hope to get out of the rat race soon.
Only as a capital improvement which gets prorated out over 27.5 years. This guy was wrong when he stated you can deduct a roof. The only way you get away with that is if you don't get audited!
I'm buying my first home which is a 2 family. I plan to live on one floor. Since I'm living in the property also... Is half the bank loan interest and half the property tax I pay deductible? Or can I deduct all of it?
Linzay Kelly repair: replace broken stove, fix hot water heater, replace broken faucet etc Improvement: add privacy fence, add backsplash in kitchen, add wooden blinds, put in fancy new faucet in kitchen
could you write off a shower replacement if the current shower is leaking and needs to be removed for water damage inspection? The current shower is also designed for someone with a disability and I currently rent to a small family with a child that requests I replace the faulty shower with a tub if possible.
would I be correct to assume that a new shower or tub stall would constitute a replacement and not technically a repair? Or would this situation be some what different considering the leak and potential long term damage that could occur if not dealt with. e.g. serious water damage, mold problems such things that could lead to long term health problems and maybe even the floor caving in? Water also effects the family's ability to do laundry as it leaks directly above their laundry area.
But if you don't pay tax now. You will need to pay later when you sell the house. When you sell the house we are required to pay back the deduction portion taken before... We pay either now or later on. Which way is better. If one is selling the house in 2 years? By paying later on we have more cash flow.
@@RedactedNews I did some more study in this capital gain tax. Everyone will get old and die. At some point, the property will need to pass on to your children or convert to cash to pay for hospital bill before dead. After pass away nothing matter... If we pay the tax now. No need to pay back all the deduction you mention on your video. If we pay later, we have more cash flow around. Which way is better? Uncle Sam get u in either way...
Do you suggest I get an LLC on my first property investment? I am purchasing my first property in my home town (just miles away) as my first real investment! I’m very excited and a bit scared at the same time.....
I wish I could deduct a new roof as an expense in the current year but it needs to be listed as an improvement and depreciated over the expected life span of the improvement.
Quick question - all of these deductions are great but if you have a W2 job that exceeds $150k, your write offs don’t reduce your taxable income at all. In terms of there is no benefit if you’re a high earner. Is this accurate?
Would you rather sell if you have a property that literally breaks even after paying the monthly mortgage, hoa and property manager? It's still going to build equity over time. Need some advice. Thanks!!
WoW!!! I am not real estate owner...yet but I would LOVE to become one. I aways have wanted to own rental property. It has been sooo worth the low cost to become a subscriber to your "channels" (sorry, I don't know what else to call it.) I am really looking forward to learning more Clayton. Thanks ooodles!! Happy New Year!! 🎉🎊 May the new year improve, for EVERYONE!! 💜🌷
Would I have to take a loss if I pay cash for a property? Or can I write off most things and not have to pay any tax on the rent money I get from tenant?
Can you claim a tax deduction on the land you rent to park your RV on each year and it's considered your primary dwelling spot? The Rv is also fully owned by me. Is this allowed?
What about property appraisals and inspections? For example - this past year I paid for 2 property appraisals and inspections and DIDN'T buy the property because the deal fell through. However, I still incurred the expense. Are these tax deductible?
Incorrect information! For example: a new roof is NOT a repair and therefore NOT deductible. . A new roof is an improvement (Morris even used the word "improve" when referring to the roof. (around the 4 minute mark) Long distance travel to visit your properties, you canNOT deduct meals 100%. Meals are only 50% deductible. Travel in your car to your rental properties: you can NOT claim both mileage and gas expenses.
When a roof is damaged to a point where it needs to be replaced with a new roof then it would be considered a “repair” When you take an existing roof and say you improve that roof with a skylight or dormer, then THAT is an improvement. A roof is a necessity and when it is damaged and gets replaced that is still a repair. Some repairs require a complete removal and replacement.
Hi im 20 i would like to buy my first rental property and I am wondering if I buy a flat and fix it completely like every single thing, Is it possible to get 100% tax returned? For ex Even if I spend 50 000 dollars to fix it I will get all the money back? Aldo can you tell me how do I get these money? Do I have to spend my money and claim them after all? Or get the money and do what I got to to with them? Thanks
So wait, do you need LLC to take advantage of these tax write offs? What if I'm just a person with a 9-5 that wants rental property for extra income? Part of the reason why I wanted to have rental property are the tax write offs but I want to know if I need an LLC to take advantage of the tax write offs.
Had the same question 😉 I’ll be closing on my first investment property in Jan so I’m notating everything I can before I fill it with a tenant so I can prepare! Instead of doing an LLC I’m just ramping up my property insurance liability to $1M for only like $5 extra per month. No brainer to do this for 2-4 more properties, then when I grow to a larger portfolio I may do an LLC with umbrella insurance...idk
I plan on purchasing a property with my 401k in 2021. But their is a lot of income taxes that will be due as a result. Could the rental property offset these taxes associated with 401k withdraw?
@@RedactedNews say you have to remodel your basement. 1- Can you use your "9-5" money if you dont have enough set aside yet. Or 2 should u do like a credit card be get these tax benefits? Thanks in advance
What if an investor has no one to pass their real estate property to? What would be the best course of action to benefit from the real estate asset saving?
So I assume this is for the untied states. I look at entrepreneurship, and I dont see any possible way to get these kind of tax benefits living in Canada. Anyone have any idea how to invest or what assets to aquire in Canada? Or is my only hope to move to the us
Do these deductibles work if you're not active with your rental property? Can I apply these if I'm passive such as just hiring property management to do all the work?
Amazing video thank you I have a question obviously there is a difference in tax benefits between baying house where you gona live and baying a income property Can you point out some or all the differences between those And what is difference if you bay income property a duplex and you live in one appartment and rent another one Thank you
Do you mean... even real estate tax by to your county.... Only the abscent to the answer of this question is keep me from plunging into the game..... How do I avoid or minimize real estate taxes.
![NISAMANEE - TADA (ท้าดา) [ OFFICIAL MV ]](http://i.ytimg.com/vi/hcQHEPMmJpU/mqdefault.jpg)
Very concise unlike a lot of other videos on the rental properties. Good job
Thanks so much!
Cheers for this, been searching for "passive income investments" for a while now, and I think this has helped. You ever tried - Qonmily Passive Formality - (do a google search ) ? Ive heard some amazing things about it and my brother in law got excellent success with it.
@@RedactedNews Would I have to take a loss if I pay cash for a property? Or can I write off most things and not have to pay any tax on the rent money I get from tenant?
In this pandemic
Mortality and digitalization is be enormous
Less demand means less value of property
SO REAL ESTATE IS NOT A GOOD INVESTMENT,NOW
Hey, can you claim a tax deduction on the land you rent to park your RV on each year and it's considered your primary dwelling spot? The Rv is also fully owned by me. Is this allowed?
It's very nice to get all this info without anyone yelling at me.
KidCity Lynnwood haha Dave Ramsey got u shook?
Lol no *BEN MALLAH*
Not to mention it's free advice 😀😀😀😀😀😀
@@johnvigil8440 Dave Ramsey would never give advice like that. His advice is stick to beans and rice, cut up credit cards and buy rentals with cash…. He’s a clown
I’ve met DR in person, he’s even less kind face to face than on the air.
I'm new to RE investing but I will always remember that quote "If you're paying any taxes as a real estate investor you're doing something wrong"
That quote will be in my head every year at tax time during my RE investing journey to guide me in doing this right.
Thanks.
In most cases a new roof on a property would likely have to be depreciated over time and could not be deducted all in one year.
not a CPA but most times if the contractor can split the bill in Labor and materials you should be able to list it in the first year but check with your tax adviser or require the total roof repair to be made in 3 separate repair bills for 1st or 2nd year recoup. just saying
Yeah, a new roof is not a repair it's a capital improvement so can't be fully written off on first year. Really curious how you don't know that.
Your accountant is correct... Below is an great example I found:
The basis of property you inherit is usually the property’s fair market value at the time the owner died. Thus, if you hold on to your rental property until death, your heirs will be able to resell it and pay little or no tax-the ultimate tax loophole.
Example: Victoria inherits her deceased parents' home. The property’s fair market value (excluding the land) is $300,000 at the time of her uncle’s death. This is Victoria’s basis. She sells the property for $310,000. Her total taxable profit on the sale is only $10,000 (her profit is the sales price minus the home's tax basis).
The basis of a home or other property you receive as a gift is its adjusted basis in the hands of the gift giver when the gift was made.
I'm going to take a class on preparing taxes, and there are about 6 levels to achieve to be a professional tax consultant. This really is an eye-opener for me. Thank you 😊 so much?
Way to go!
I was just listening to the Rich Dad Poor Dad podcast on depreciation and searched on youtube for more elaboration and it was Morris invest who they were speaking too.... so wow small world. Thanks for the valuable video!
Love that!
Morris is phenomenal in his approach to this spectacular subject! So fortunate to have found channel!!
+PR Riches thanks so much.
land is appreciating, building is depreciating (just much slower than the depreciation rate of your taxes)
Hate taxes..great info..thanks!
Just a reminder that it makes sense to depreciate the max amount if you're holding and renting property but you'll get hit harder if you're flipping.
Why exactly? Thanks!
The FICA is what kills me lol. I have a small office rental. It brings in $32,000 a year. I pay the triple nets, dumb i know lol. After deductions im around $22,000 self employment income. 15.3% of that is still a lot.
I own commercial real estate, so I am familiar with depreciation. Repairs and improvements are different things. It may well be that the IRS is not a stickler about these, but they are distinctly different and it sucks for me to have to pay for a buildout for a new tenant and not be able to claim it right away, but have to amortize that expense over the life of the property.
It benefit you because Capital Improvements even though they are depreciated they reduce your taxable income
But A mortgage lender can add them back in to your qualifying income to help you buy more property
Replacing a roof is not an expense, it is an improvement that extends the life of the property and a s such must be depreciated of 27.5 years and not expensed in one year. A small portion of the roof can be repaired and be claimed as an expense. Ithe IRS ruling is that if any work restores the property or extends the usefull life of the building, it must be depreciated not expensed. Meals can only be expensed up to 50%
Yes your 100% correct !!!!! The trick is to replace 50% of the roof one year and 50% the next year. Then its a repair and a write off
@@dropoutandretireearly1781 If that's true, that's great to know, I'll be asking my accountant. I know a lot of real estate investors and I have never seen them do their roofs in different time frames.
That is simply not true.
You can only save on taxes for the income from the real estate property. which means if you have a regular job, you still have to pay taxes on those income and you cannot claim rental expenses to reduce your taxable income that came from your regular job
Roofs are considered an improvement (as an a capital improvement) & therefore Subject to the depreciation table not as a wholesale whole number deduction.
From talking to my friends that own rentals that your better off buying a multi unit rentals like a duplex
I currently own a single family home as a rental
+Don Dressel I personally prefer to invest in single-family homes. Here's why: goo.gl/QGc95i
I'm so pumped and ready to buy my first multi family unit this year this is great info thank u
did you buy your megamultifamilyunit bra
@@CC-jy4gr Ya. How is it going?
@@superstarr310 sup punk
What is the capital gains formula for selling an investment property if there is still a mortgage owed?
One thing people usually forget about write-offs is that you have to pay for them in the first place.
If you are doing repairs yourself can you deduct your time like paying a contractor?
What about lawn service .
I was wondering how deductions apply to purchasing a new property. From what I understand, you can’t deduct start up costs. Is this correct? If so, if the previous tenant is in the house after you close, and move out after a few days, are you then able to write off start up costs? I’ve also read where a loophole is to list the property for rent day one, even though it’s not ready to be rented.
+tpmartins You are correct! You should check out Garrett Sutton's book, Loopholes of Real Estate: goo.gl/JaKc92
Question: when you do a major repair (like roof, floors..etc) can you claim it as an expense or do you do scheduled depreciation..?
We have a podcast episode on this! morrisinvest.com/episode139
what about the property taxes ? can the taxes paid for county/ city be deducted ?
So I have a 9-5 job and I'm at a high tax bracket. My personal income tax is usually around $20k. Will investing in real estate offset my personal income tax or is it just for taxes in the real estate business?
Also wondering this, did you ever find answer?
Print off a sch e and it will list your real estate expenses. An 8829 also if you use a home office. I forget but i think an llc is a 1065 partnership return. Not sure but if you make an llc you will report your real estate there. Key though get a sch e form.
The mileage credit is ridiculous! For example, I know people who use a service to accept rent and of course there's a fee. I have 3 local properties so I can drive, pick up the rent, and stop in the place I was undoubtedly going to drive to anyway for lunch because it's on the way. Now instead of paying a service 2% or 3% I get all of the money, an opportunity to visually inspect the property (last time on one I realized I need to clean the gutters), and the drive itself becomes a profitable trip at tax time.
Can you write off the amount of money you pay your accountant to do your taxes as a business expense?
replacing a roof is an improvement not an expense right?
+Marty Flipper Check out this podcast episode about repairs vs. improvements: goo.gl/yvL5ws
Marty Flipper you're right. A new roof would not be allowed to be deducted. Repair vs. Replace.
George Allred not all roofs can just be repaired though. At some point a new roof is called for. Is that an expense that can be written off?
Lindsay Maupin no. A new roof is considered an improvement and just be depreciated with the house.
Marty Flipper correct, he's misreprenting some facts
Hey question? If u don’t have a business can u write these things off on your personal income? Newbie here
No, this is for investors.
You don't need to have a business to own Rental Property. Altho some Cities requires a Business License such as Central, S. Carolina. Some cites don't require a licenses but require you to pay a fee on the refrigerator, washer, dryer which gets depreciated until zero like Lehigh Acres, FL. Some cities don't require anything like Benton, AR or Lawndale, CA.
Thank for your videos!! I recently purchased my first property and am renting it out while traveling for work. This is my first year owning a rental, so I only have one. I am trying to figure out how to do the taxes myself and am unsure about what to put for depreciation. This is my main question right now.
Does the 27.5 years start the year you purchase? Do I put $0 in those spaces for “before and after 1997” since I just bought the property? Or do I have to calculate it using the fair market price/appraised value? So many questions. Thanks!!
Get an accountant.
All this applies to a single home 🏠 and I just buy another single home which I’m living in it any reforms or additions like a privacy fence counter tops...etc would that add value to the house and I assume since I’m living in it I won’t be able to claim it on this years taxes?
I have a question that i look all over the internet and i cant find the answer. I hope some one here have the answer .
The depreciation is calculated from the money ypu have left after expenses like mortgage and water bill . Example
I charge rent 1k per month x 12 is 12,000 a year ypu use this amout or you use the amount left after expenses like i charge 1k per month but i pay 50 for water and 600 fpr mortgage i have left 350 per month x 12 is 4,200 per year. Which one you use yo calculate depreciation please some answer ???????
I plan to buy another house and rent out my current home. Can I put it in an llc and write off the repairs it needs to get it ready for a rental. Repairs are minimal painting, deck repair and new roof.
So glad i saw this, have neen doing this on my personal taxes since our first house became a rental. Inly one i need to keep better track of is my mileage when i drive by to see how the place is looking.. thanks for the list
Glad it was helpful!
LOL on the nap at the desk. I've done that way too often...sometimes with hands resting on the keyboard.
1. How do u get properties on LLC / Corp.
2. How to make the bank do that as in most of the cases they don’t agree on this as the mortgage is taken in the name of the owner / spouse ..
3. Is depreciation on asset mentioned by u applicable in Canada ... thanks
Very clearly explained. Really helped me understand how this works. THANK YOU!
That's great! Glad you liked this one.
I recently created an LLC, for a reason other than property ownership and only lately decided that i wish to buy and rent out homes. My question is should i buy those properties under the said LLC or under my personal name. Thank you
This is the best video I've ever seen. Thanks Morris.
+LYIRICSMAKINGSENSE Thank you so much!
Morris Invest thank you for the inspiration.
Thank you!
Should mention the depreciation recapture if the property is sold...
Is this true if even if you’re a landlord without an LLC? Or do you need an LLC
No need for LLC
Can I as an investor of a rental property write off expenses for initial rehab of a house and the contractor’s work on the house? Your videos have been extremely inspiring and informative. Hope to get out of the rat race soon.
Yes! Contact your CPA!
Only as a capital improvement which gets prorated out over 27.5 years. This guy was wrong when he stated you can deduct a roof. The only way you get away with that is if you don't get audited!
Excellent Advice!!! I'm glad that I have found your channel.
+The Chose One Out of them all Glad you're here!
I'm buying my first home which is a 2 family. I plan to live on one floor. Since I'm living in the property also... Is half the bank loan interest and half the property tax I pay deductible? Or can I deduct all of it?
Extremely valuable; I was recently wondering and seriously thinking about how taxes are handled when you have rental properties- thanks Clayton!
What's the difference between a repair and an improvement???
Linzay Kelly repair: replace broken stove, fix hot water heater, replace broken faucet etc
Improvement: add privacy fence, add backsplash in kitchen, add wooden blinds, put in fancy new faucet in kitchen
For rental property what section should I put for tree removal write off?
could you write off a shower replacement if the current shower is leaking and needs to be removed for water damage inspection? The current shower is also designed for someone with a disability and I currently rent to a small family with a child that requests I replace the faulty shower with a tub if possible.
would I be correct to assume that a new shower or tub stall would constitute a replacement and not technically a repair? Or would this situation be some what different considering the leak and potential long term damage that could occur if not dealt with. e.g. serious water damage, mold problems such things that could lead to long term health problems and maybe even the floor caving in? Water also effects the family's ability to do laundry as it leaks directly above their laundry area.
But if you don't pay tax now. You will need to pay later when you sell the house. When you sell the house we are required to pay back the deduction portion taken before...
We pay either now or later on.
Which way is better. If one is selling the house in 2 years?
By paying later on we have more cash flow.
Hi Haru! We are buy and hold investors, so we don't usually sell houses. If necessary, you can always do a 1031 exchange to avoid capital gains taxes.
@@RedactedNews I did some more study in this capital gain tax.
Everyone will get old and die. At some point, the property will need to pass on to your children or convert to cash to pay for hospital bill before dead. After pass away nothing matter...
If we pay the tax now. No need to pay back all the deduction you mention on your video.
If we pay later, we have more cash flow around.
Which way is better?
Uncle Sam get u in either way...
Do you suggest I get an LLC on my first property investment? I am purchasing my first property in my home town (just miles away) as my first real investment! I’m very excited and a bit scared at the same time.....
I wish I could deduct a new roof as an expense in the current year but it needs to be listed as an improvement and depreciated over the expected life span of the improvement.
How do you qualify for new properties if your income breaks even because of so many losses? Aka offsetting income . I hope I asked that correctly 😂
Quick question - all of these deductions are great but if you have a W2 job that exceeds $150k, your write offs don’t reduce your taxable income at all. In terms of there is no benefit if you’re a high earner. Is this accurate?
Would you rather sell if you have a property that literally breaks even after paying the monthly mortgage, hoa and property manager? It's still going to build equity over time. Need some advice. Thanks!!
I am buying a second home, I have an LLC but not buying it in an LLC is that terrible. Can I convert it later?
How about legal services for civil cases against tenants and property managers can this be written off a a tax deduction?
WoW!!! I am not real estate owner...yet but I would LOVE to become one. I aways have wanted to own rental property. It has been sooo worth the low cost to become a subscriber to your "channels" (sorry, I don't know what else to call it.) I am really looking forward to learning more Clayton. Thanks ooodles!! Happy New Year!! 🎉🎊 May the new year improve, for EVERYONE!! 💜🌷
Q: Is my apple care the same as insurance? Can I right of an electronic that has to do with my LLC?
Would I have to take a loss if I pay cash for a property? Or can I write off most things and not have to pay any tax on the rent money I get from tenant?
Can you claim a tax deduction on the land you rent to park your RV on each year and it's considered your primary dwelling spot? The Rv is also fully owned by me. Is this allowed?
What about maintenance costs, i.e. annual inspections of water softener, Iron curtain and HVAC system?
Thanks for redirecting me here! Very Informative, I will definitely be commenting and liking more of your videos, cheers
+Team Salwan Awesome, thank you! Glad you found it helpful.
What about property appraisals and inspections? For example - this past year I paid for 2 property appraisals and inspections and DIDN'T buy the property because the deal fell through. However, I still incurred the expense. Are these tax deductible?
Hi Manny, we aren't tax professionals---please consult a real estate savvy CPA to get the most accurate answer.
@Manny Dorticos Hey did you find the answer to your question?
Is this in Australia
Do you have to have the property under an LLC to do this?
Incorrect information! For example: a new roof is NOT a repair and therefore NOT deductible. .
A new roof is an improvement (Morris even used the word "improve" when referring to the roof. (around the 4 minute mark) Long distance travel to visit your properties, you canNOT deduct meals 100%. Meals are only 50% deductible. Travel in your car to your rental properties: you can NOT claim both mileage and gas expenses.
When a roof is damaged to a point where it needs to be replaced with a new roof then it would be considered a “repair”
When you take an existing roof and say you improve that roof with a skylight or dormer, then THAT is an improvement.
A roof is a necessity and when it is damaged and gets replaced that is still a repair. Some repairs require a complete removal and replacement.
He also never once said you can write off “gas” expenses, let alone double dipping by claiming both
You can write off mileage only, not gas expenses. There is a difference.
sally victor don't quit your day job
Hey Clayton, for depreciation, do we simply divide purchase price by 27.5? Or is it current market value each year?
Property minus land value
Great vid thanks. I think a roof is a depreciation over 27.5 years not a repair deductible totally in the year done.
Can you still take tax deductions if I rent out a room in my house?
This it true only for usa or it works for europe as well
Hi im 20 i would like to buy my first rental property and I am wondering if I buy a flat and fix it completely like every single thing, Is it possible to get 100% tax returned? For ex Even if I spend 50 000 dollars to fix it I will get all the money back? Aldo can you tell me how do I get these money? Do I have to spend my money and claim them after all? Or get the money and do what I got to to with them? Thanks
So wait, do you need LLC to take advantage of these tax write offs? What if I'm just a person with a 9-5 that wants rental property for extra income? Part of the reason why I wanted to have rental property are the tax write offs but I want to know if I need an LLC to take advantage of the tax write offs.
Question: Does one has to have a business/LLC in order to claim these deductions?
No, you can claim them as a sole proprietor. Most accountants and lawyers will advise you to operate out of a business entity though.
Had the same question 😉 I’ll be closing on my first investment property in Jan so I’m notating everything I can before I fill it with a tenant so I can prepare! Instead of doing an LLC I’m just ramping up my property insurance liability to $1M for only like $5 extra per month. No brainer to do this for 2-4 more properties, then when I grow to a larger portfolio I may do an LLC with umbrella insurance...idk
I plan on purchasing a property with my 401k in 2021. But their is a lot of income taxes that will be due as a result. Could the rental property offset these taxes associated with 401k withdraw?
Hello is good if i buy a car for my real state LLC, and if i sell other things with it like office products, then isn't a problem???
So I have 3 rental units on one property so do they all work under the same LLC or get them their own?
Does the rental have to be in an LLC to claim these expenses, like the travel?
No, the LLC is more for legal protection.
@@RedactedNews say you have to remodel your basement. 1- Can you use your "9-5" money if you dont have enough set aside yet. Or 2 should u do like a credit card be get these tax benefits? Thanks in advance
Morris Invest can you still claim the deductions as a LLC
What if an investor has no one to pass their real estate property to? What would be the best course of action to benefit from the real estate asset saving?
Repairs are deductible only if the house is rented with tenants living there.
No shit sherlock
Not every new home owner knows that dickhead
So I assume this is for the untied states. I look at entrepreneurship, and I dont see any possible way to get these kind of tax benefits living in Canada.
Anyone have any idea how to invest or what assets to aquire in Canada? Or is my only hope to move to the us
But if I don’t have any “income” from the rentals, how banks going to financial me for the next mortgage???
Do these deductibles work if you're not active with your rental property? Can I apply these if I'm passive such as just hiring property management to do all the work?
Hi Kevin, check out our updated podcast episode on taxes in 2018! morrisinvest.com/episode302
Absolutely in general. It's a business
Is HELOC interest rate still tax deductible? A CPA Illinois friend of mine said no. New law I'm guessing in 2018.
We have a video on this topic! bit.ly/2m5ecNc
Can you do some of it if you rent part of you home and you don't have a company created such as LLC?
Amazing video thank you
I have a question obviously there is a difference in tax benefits between baying house where you gona live and baying a income property
Can you point out some or all the differences between those
And what is difference if you bay income property a duplex and you live in one appartment and rent another one
Thank you
Hello does this apply to real estate investment in Uk or just US?
Can you offset your expenses to your w2 income if you are filing on a schedule e
Can anyone do depreciation? I thought you have to be a “qualified real estate” professional?
If we buy house and put on rent do we need to pay tax
Okay first, I need the contact info of your accountant lol
morrisinvest.com/taxes
How much of the expenses listed can you write off is it a certain portion of each one or the complete exspence
This was excellent information! If rental property is a townhouse and has HOA will that be eligible for tax deduction?
Your HOA dues will be deductible
Very informative, Thanks a lot!!
Glad it was helpful!
Can you claim depreciation in your home if you are using it as primary residence ?
Do these deductions also work if you live in one of the apartments in your rental property?
Partially! Please work with a CPA who is well-versed in real estate. morrisinvest.com/taxes
Only the unit(s) you rent out. The other is considered your residence.
What about the property taxes here in dallas you have to pay 15,000 of property !
Do you mean... even real estate tax by to your county.... Only the abscent to the answer of this question is keep me from plunging into the game..... How do I avoid or minimize real estate taxes.
+Patiuko Lou If you have further questions about taxes, I recommend Tom Wheelwright's book, Tax-Free Wealth. goo.gl/scysIu
Thanks for the quick answer... I'll get that book.... Thanks again!!!
Can I write off my HOA for my rental property?
Do you need an llc to take these tax breaks?
Thank you Very much. I just bought a Investment property and your advise is very helpful.
What if you don't live in the state of your rental property and are not 'actively' managing it???