Monday, October 10, 2011
California Foreclosures on a National Scale
California has had in the last 11 months, more than a half-million homes entered into foreclosure. While California used to have five cities ranked on the list of the 10 highest in foreclosures in the USA, it now has eight such cities.
Friday, September 30, 2011
WHAT TO DO WHEN YOU OWE MORE THAN YOUR HOUSE IS WORTH?
There are essentially two options:
Continue to cut spending and look for side jobs in a painful attempt to convince yourself things will change for the better eventually.
Or, you can admit defeat, default on your debts, and hope for the best.
Continue to cut spending and look for side jobs in a painful attempt to convince yourself things will change for the better eventually.
Or, you can admit defeat, default on your debts, and hope for the best.
WHEN PURCHASING A PROPERTY
Talking Points
- When purchasing a property, most borrowers will conduct their due diligence on the house, examining its structural soundness and the surrounding neighborhood. However, not all borrowers do a thorough vetting of the lender.
- Borrowers are advised to focus more on the individual who would be the mortgage broker, loan officer or loan originator rather than the lending institution.
- Among the questions borrowers should ask are: How long has the individual been in the field? How well or promptly does he answer questions? Does he want to know the borrower’s financial goals?
Thursday, December 9, 2010
one of my favorite hedge fund managers
CHECK OUT THIS RECENT QUOTE BY A MAN KNOW TO HAVE MADE THE GREATEST TRADE OF ALL TIME!
Favorite quote made recently by John Paulson's who bet against the housing market before the CRASH is thought to be The Greatest Trade Ever: "If you don't own a home buy one. If you own one home, buy another one, and if you own two homes buy a third."
FEEL FREE TO EXPRESS YOUR OPINION ON BUYING A HOME IN TODAY'S ENVIORMENT?
Favorite quote made recently by John Paulson's who bet against the housing market before the CRASH is thought to be The Greatest Trade Ever: "If you don't own a home buy one. If you own one home, buy another one, and if you own two homes buy a third."
FEEL FREE TO EXPRESS YOUR OPINION ON BUYING A HOME IN TODAY'S ENVIORMENT?
Friday, December 3, 2010
energy-saving tax credit
Talking Points
As winter approaches, homeowners may be looking for ways to cut energy bills. To assist with the cost of making energy-saving home improvements, the federal government is offering tax credits for qualified purchases. However, some of the credits expire Dec. 31, 2010.
Homeowners can get a tax credit for installing certain wood or pellet stoves; energy-efficient furnaces, water heaters, and air-conditioning systems; insulated roofs, windows, and doors; and wall and ceiling insulation. The tax credit covers 30 percent of the purchase costs, up to $1,500. A full list of eligible purchases can be found at www.energystar.gov.
As winter approaches, homeowners may be looking for ways to cut energy bills. To assist with the cost of making energy-saving home improvements, the federal government is offering tax credits for qualified purchases. However, some of the credits expire Dec. 31, 2010.
Homeowners can get a tax credit for installing certain wood or pellet stoves; energy-efficient furnaces, water heaters, and air-conditioning systems; insulated roofs, windows, and doors; and wall and ceiling insulation. The tax credit covers 30 percent of the purchase costs, up to $1,500. A full list of eligible purchases can be found at www.energystar.gov.
Thursday, April 29, 2010
Top Ten Tax Deductions for Landlords
Learn about the many tax deductions available to rental property owners.
Every year, millions of landlords pay more taxes on their rental income than they have to. Why? Because they fail to take advantage of all the tax deductions available for owners of rental property. Rental real estate provides more tax benefits than almost any other investment.
Often, these benefits make the difference between losing money and earning a profit on a rental property. Here are the top ten tax deductions for owners of small residential rental property.
1. Interest
Interest is often a landlord's single biggest deductible expense. Common examples of interest that landlords can deduct include mortgage interest payments on loans used to acquire or improve rental property and interest on credit cards for goods or services used in a rental activity.
2. Depreciation
The actual cost of a house, apartment building, or other rental property is not fully deductible in the year in which you pay for it. Instead, landlords get back the cost of real estate through depreciation. This involves deducting a portion of the cost of the property over several years.
3. Repairs
The cost of repairs to rental property (provided the repairs are ordinary, necessary, and reasonable in amount) are fully deductible in the year in which they are incurred. Good examples of deductible repairs include repainting, fixing gutters or floors, fixing leaks, plastering, and replacing broken windows.
4. Local Travel
Landlords are entitled to a tax deduction whenever they drive anywhere for their rental activity. For example, when you drive to your rental building to deal with a tenant complaint or go to the hardware store to purchase a part for a repair, you can deduct your travel expenses.
If you drive a car, SUV, van, pickup, or panel truck for your rental activity (as most landlords do), you have two options for deducting your vehicle expenses. You can:
deduct your actual expenses (gasoline, upkeep, repairs), or
use the standard mileage rate (55 cents per mile for 2009; 58.5 cents per mile for July 1, 2008 through December 31, 2008 and 50.5 cents per mile from January 1, 2008 through June 30, 2008). To qualify for the standard mileage rate, you must use the standard mileage method the first year you use a car for your business activity. Moreover, you can't use the standard mileage rate if you have claimed accelerated depreciation deductions in prior years, or have taken a Section 179 deduction for the vehicle.
5. Long Distance Travel
If you travel overnight for your rental activity, you can deduct your airfare, hotel bills, meals, and other expenses. If you plan your trip carefully, you can even mix landlord business with pleasure and still take a deduction.
However, IRS auditors closely scrutinize deductions for overnight travel -- and many taxpayers get caught claiming these deductions without proper records to back them up. To stay within the law (and avoid unwanted attention from the IRS), you need to properly document your long distance travel expenses.
6. Home Office
Provided they meet certain minimal requirements, landlords may deduct their home office expenses from their taxable income. This deduction applies not only to space devoted to office work, but also to a workshop or any other home workspace you use for your rental business. This is true whether you own your home or apartment or are a renter.
For the ins and outs on taking the home office deduction, see Home Business Tax Deductions or Every Landlord's Tax Deduction Guide, both by Stephen Fishman (Nolo).
7. Employees and Independent Contractors
Whenever you hire anyone to perform services for your rental activity, you can deduct their wages as a rental business expense. This is so whether the worker is an employee (for example, a resident manager) or an independent contractor (for example, a repair person).
8. Casualty and Theft Losses
If your rental property is damaged or destroyed from a sudden event like a fire or flood, you may be able to obtain a tax deduction for all or part of your loss. These types of losses are called casualty losses. You usually won't be able to deduct the entire cost of property damaged or destroyed by a casualty. How much you may deduct depends on how much of your property was destroyed and whether the loss was covered by insurance.
9. Insurance
You can deduct the premiums you pay for almost any insurance for your rental activity. This includes fire, theft, and flood insurance for rental property, as well as landlord liability insurance. And if you have employees, you can deduct the cost of their health and workers' compensation insurance.
10. Legal and Professional Services
Finally, you can deduct fees that you pay to attorneys, accountants, property management companies, real estate investment advisors, and other professionals. You can deduct these fees as operating expenses as long as the fees are paid for work related to your rental activity.
Did You Know?
Did you know that:
Landlords can greatly increase the depreciation deductions they receive the first few years they own rental property by using segmented depreciation. Careful planning can permit you to deduct, in a single year, the cost of improvements to rental property that you would otherwise have to deduct over 27.5 years. You can rent out a vacation home tax-free, in some cases. Most small landlords can deduct up to $25,000 in rental property losses each year. A special tax rule permits some landlords to deduct 100% of their rental property losses every year, no matter how much. People who rent property to their family or friends can lose virtually all of their tax deductions.If you didn't know one or more of these facts, you could be paying far more tax than you need to. For more information, see Every Landlord's Tax Deduction Guide, by Stephen Fishman (Nolo).
Every year, millions of landlords pay more taxes on their rental income than they have to. Why? Because they fail to take advantage of all the tax deductions available for owners of rental property. Rental real estate provides more tax benefits than almost any other investment.
Often, these benefits make the difference between losing money and earning a profit on a rental property. Here are the top ten tax deductions for owners of small residential rental property.
1. Interest
Interest is often a landlord's single biggest deductible expense. Common examples of interest that landlords can deduct include mortgage interest payments on loans used to acquire or improve rental property and interest on credit cards for goods or services used in a rental activity.
2. Depreciation
The actual cost of a house, apartment building, or other rental property is not fully deductible in the year in which you pay for it. Instead, landlords get back the cost of real estate through depreciation. This involves deducting a portion of the cost of the property over several years.
3. Repairs
The cost of repairs to rental property (provided the repairs are ordinary, necessary, and reasonable in amount) are fully deductible in the year in which they are incurred. Good examples of deductible repairs include repainting, fixing gutters or floors, fixing leaks, plastering, and replacing broken windows.
4. Local Travel
Landlords are entitled to a tax deduction whenever they drive anywhere for their rental activity. For example, when you drive to your rental building to deal with a tenant complaint or go to the hardware store to purchase a part for a repair, you can deduct your travel expenses.
If you drive a car, SUV, van, pickup, or panel truck for your rental activity (as most landlords do), you have two options for deducting your vehicle expenses. You can:
deduct your actual expenses (gasoline, upkeep, repairs), or
use the standard mileage rate (55 cents per mile for 2009; 58.5 cents per mile for July 1, 2008 through December 31, 2008 and 50.5 cents per mile from January 1, 2008 through June 30, 2008). To qualify for the standard mileage rate, you must use the standard mileage method the first year you use a car for your business activity. Moreover, you can't use the standard mileage rate if you have claimed accelerated depreciation deductions in prior years, or have taken a Section 179 deduction for the vehicle.
5. Long Distance Travel
If you travel overnight for your rental activity, you can deduct your airfare, hotel bills, meals, and other expenses. If you plan your trip carefully, you can even mix landlord business with pleasure and still take a deduction.
However, IRS auditors closely scrutinize deductions for overnight travel -- and many taxpayers get caught claiming these deductions without proper records to back them up. To stay within the law (and avoid unwanted attention from the IRS), you need to properly document your long distance travel expenses.
6. Home Office
Provided they meet certain minimal requirements, landlords may deduct their home office expenses from their taxable income. This deduction applies not only to space devoted to office work, but also to a workshop or any other home workspace you use for your rental business. This is true whether you own your home or apartment or are a renter.
For the ins and outs on taking the home office deduction, see Home Business Tax Deductions or Every Landlord's Tax Deduction Guide, both by Stephen Fishman (Nolo).
7. Employees and Independent Contractors
Whenever you hire anyone to perform services for your rental activity, you can deduct their wages as a rental business expense. This is so whether the worker is an employee (for example, a resident manager) or an independent contractor (for example, a repair person).
8. Casualty and Theft Losses
If your rental property is damaged or destroyed from a sudden event like a fire or flood, you may be able to obtain a tax deduction for all or part of your loss. These types of losses are called casualty losses. You usually won't be able to deduct the entire cost of property damaged or destroyed by a casualty. How much you may deduct depends on how much of your property was destroyed and whether the loss was covered by insurance.
9. Insurance
You can deduct the premiums you pay for almost any insurance for your rental activity. This includes fire, theft, and flood insurance for rental property, as well as landlord liability insurance. And if you have employees, you can deduct the cost of their health and workers' compensation insurance.
10. Legal and Professional Services
Finally, you can deduct fees that you pay to attorneys, accountants, property management companies, real estate investment advisors, and other professionals. You can deduct these fees as operating expenses as long as the fees are paid for work related to your rental activity.
Did You Know?
Did you know that:
Landlords can greatly increase the depreciation deductions they receive the first few years they own rental property by using segmented depreciation. Careful planning can permit you to deduct, in a single year, the cost of improvements to rental property that you would otherwise have to deduct over 27.5 years. You can rent out a vacation home tax-free, in some cases. Most small landlords can deduct up to $25,000 in rental property losses each year. A special tax rule permits some landlords to deduct 100% of their rental property losses every year, no matter how much. People who rent property to their family or friends can lose virtually all of their tax deductions.If you didn't know one or more of these facts, you could be paying far more tax than you need to. For more information, see Every Landlord's Tax Deduction Guide, by Stephen Fishman (Nolo).
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