The government loves it when you make a lot of money. And why shouldn’t it? It gets to take a nice chunk of your income in the form of taxes.
But what happens when you have some bad luck and don’t earn a whole lot?
The government still loves you. When your attempt to make money fails, Uncle Sam allows you a tax deduction for your losses.
Our new article titled Tax Tips on Failed Rental Property Purchase examines a failed rental-property purchase and shows you exactly how the tax law treats that failure. Don’t miss it!
Five ways our fact-filled article can help you.
- We’ll show you how easy it is to go wrong. The first thing we’ll do is share the story of Jim Joyce who lives in northern New Jersey. He traveled to Florida to buy a home to be used as a rental property. But things soon fell apart. How did tax law treat Mr. Joyce’s failed rental property purchase? You’ll find out when you read the full article.
- We’ll explain “capital acquisition costs.” Because he entered into this transaction for profit, tax law allows Mr. Joyce to deduct his failed capital acquisition costs as a loss on IRS Form 4797. We’ll explain this fully when you read the full article.
- You’ll learn about start-up and business expansion expenses. In an effort to make the tax law more fair, lawmakers enacted special rules for business start-ups and business expansion. Mr. Joyce’s cost of travel to Florida has three possible deduction avenues. We’ll discuss them in detail when you read the full article.
- We’ll take a closer look at failed start-ups. For example, we’ll provide you with a definition of a start-up expense, and specifically discuss travel costs when you read the full article.
- We’ll provide a flowchart of a failed property purchase. Don’t miss it. It gives you a quick look at the entire purchase history in a handy visual format… and it’s yours when you read the full article.