Yes. With partnerships come problems. For example, if you own an unincorporated business, you likely have a partnership for financial tax purposes. Which means you have to deal with extra tax-return filings and compliance headaches. But there is some good news. You see, there are two “elections” you can make to avoid partnership treatment and many jointly owned rental … [Read more...]
Rental Properties
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Don’t let passive losses destroy your tax-favored capital gains
Do you own rental properties? If you do, I hope they’re producing a nice cash flow for you. But sadly, that doesn’t always happen. Sometimes your rentals produce losses which the IRS classifies as “passive losses” for tax purposes. This is not necessarily terrible because you can deduct those losses against passive income you’ve earned. The rental property losses that … [Read more...]
How to avoid the “self-rental” trap
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...]
Five ways to help your adult child buy a home
Homeownership is part of the American dream. Which is why you may want to help your adult child make that important purchase. But before you pick up your checkbook, consider the tax consequences of helping out. You see, homeownership comes with some giant tax savings if you know how to play the game the right way. We’ll show you how when you read my new article titled … [Read more...]
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...]