Appreciate Some Answers...

Comments(5)

• 
  commercialking5th December, 2004

  Well I am not a specialist in such matters and you must, of course review any advice given here with your accountant:
  
  
  > On 2004-12-05 21:21, leadman wrote:
  
  >Can I depreciate an Investment property ( rental ) even if I
  >only own it for a year then sell it ?
  
  Yes, however you will also recapture the depreciation when you sell.
  
  >Is there a list for all the other items that can be depreciated
  >( appliances etc. )? What are the $ amounts & over what
  >time period ?
  
  Yes, the IRS has a guideline for such matters, and I am sure somebody will post a URL or a section of the code.
  
  >Can I write off points and/or closing costs on Investment
  >property ?
  
  Yes.
  
  >Can I write off ALL items purchased for the Investment property ?
  
  Yes, except for those that must be depreciated.
  
  >Can I write off mileage associated with ANY aspect of
  >doing REI ( i.e . going to model homes to see home
  >plans/talk w/ sales man ; going to REI meetings ; going to
  >store for purchase of Investment property items ;
  >purchasing REI materials; time associated w/ performing
  >ANY of the mentioned items ) ?
  
  Yes to all of the above except your time.
  
  >Where do I hold $ associated with each Investment
  >property ( i.e. option credit, rent credit & rent $ ) ?
  
  I am not sure I understand this question.
  
  >How do I transfer $ from REI to me safely ?
  
  You account for such transfers on the Schedule E associated with the rental property.
  
  >Who would get the tax benefits if there were more than one
  >person partnering on an Investment property ?
  
  Depending on the form of ownership there is some lattitude in the answer to this question. An LLC, for example, can divide these benefits in a different proportion than an S or C corporation can.
  
  >How would the property need to be held so all partners
  >would benefit evenly ?
  
  The more popular choice these days appears to be an LLC although an S corporation would accomplish about the same end.
  
  >How do I get around having too high of a Debt to Income
  >ratio ( as gets you declined by Mortgage co.'s )?
  
  Most lenders will allow 75% of the operating income from rental income to count toward your income for purpose of calculating your DCR.

• 
  leadman5th December, 2004

  Appreciate your input & your time !

• 
  leadman5th December, 2004

  Sorry for the double reply.
  Does that mean that the tax saved from the depreciation will be taken at the sale - basically nulling the benfit ?

• 
  commercialking5th December, 2004

  Essentially yes. Unless you do a 1031 exchange in which case the depreciation loss rolls forward into the basis of the new property and is recaptured only when that property is sold.

• 
  leadman5th December, 2004

  Back to my original post...
  
  >Where do I hold $ associated with each Investment
  >property ( i.e. option credit, rent credit & rent $ ) ?
  
  Do I hold all $ associated with this property in its own bank account ? Or can multiple properties $'s be held in the same account under the same LLC or do I need a different LLC & different bank account for each property ?
  
  Thanks