Loss For High Income?
Last month I bought 2 properties (60K & 130K). I was recently told by a friend that I could not take a loss (for depreciation or expenses) if the total household income exceeded 150K. Anyone have any insight on the above?
That is true, I am in the six figure W2 income bracket ,
My friend made 83K,
We have the exact same type of properties,
She got back $7K, I had to pay
My accountant said I was maxed out on my deductions.
Lori
[addsig]
Thanks for your reply. Do you know if there is anyway to overcome this hurdle or still benefit it.
Also if I cannot take depreciation now, what about when the time to sell comes? Will the Fed penalize me for not taking it?
I've understood that the Fed assumes that you take depreciation whether you do or not, and therefore will ALWAYS have depreciation recapure upon selling. Is there any way around this?
Tinman, What do you mean 'maxed out on my deductions'?
When I buy a property 50% of the work are repairs and 50% are capital improvements. But because of my income it doesn't matter if I use 25% or 50% for repairs, I will get the same deduction. So I use 75% capital improvements and 25% repairs. This way I will I will be able to get something even if is only a little over 27 years.
Lori
[addsig]