Here’s the “self-rental” story in a nutshell: You own a business that needs office space… So you buy a building and rent office space to your business… You collect the rent and depreciate the property… Your business gets to deduct the rent it pays you… As a result, the money never leaves your pocket. Sounds great, right? Well, it is if you know the special rules that apply … [Read more...]
Passive income and losses
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New IRS rule increase likelihood of deducting rental losses
You don’t have to sell real estate for a living to deduct your rental losses. But to deduct your rental losses against your business and investment income, you need to become a tax code “qualified person” often called in tax law a “real estate professional.” You want qualified person status. With this status, your rental properties can qualify as tax shelters. Best of all, … [Read more...]
Do Not Make This Mistake When Your Second Business Loses Money
If your second business or third business is losing money, you know what pain is. But don’t add to your troubles by losing the chance to claim an immediate tax deduction. And that’s easy to do if you don’t show the IRS that you are “materially participating” in all your businesses. We’ll tell you how to get all the deductions coming to you, and make the best of a bad … [Read more...]
Tax Secrets of Renting a Bedroom in Your Home
Do you have a spare bedroom(s) that you’d like to rent out? Go right ahead. I’m sure you’d like to pocket some extra cash and put that spare room to use. But be careful. You see, the IRS has set some dangerous traps for you that could cost you big money. If you want to stay on Uncle Sam’s good side, take my advice and read my new article titled Tax Tips: Secrets to … [Read more...]
How to avoid the “self-rental” trap
Do you rent property to your business? Then be careful. You see, under the IRS’s “self-rental” rule, you could lose money in two painful ways. You could forfeit the juicy tax breaks you’re expecting. You could wind up paying unexpected taxes. And remember, this is true even if you create a separate entity that rents the property to your business! What can you do to … [Read more...]