New answers tagged

1

The main purpose of an LLC is to provide liability shield, and complex distribution of ownership vs management rights, without the tax complexities and "double taxation" of a corporation. The IRS won't even see it When you form an LLC, it assumes pass-through tax treatment by default. It's possible to elect corporate tax treatment, in which case ...


3

The IRS looks at these types of transaction with skepticism. Since it isn't being sold at fair market value, they are concerned that any losses are fake. Of course selling the property for less than you paid for it might not work the way you expect. In those years that you rented the property to tenants you were taking depreciation of the structure. During ...


0

The capital gain would be $900k - ($500k - depreciation that was taken or should have been taken), assuming no improvements were done for simplicity. From https://www.irs.gov/publications/p544#en_US_2020_publink100072284: Property Changed to Business or Rental Use You can deduct a loss on the sale of property you acquired for use as your home but changed to ...


1

The instructions and links to e-file all of these taxes are available online. The rental portion of School Income tax is modified with this instruction for line 7. I can't tell you under what circumstance a personal rental property would be subject to school income and not to Net Profits Tax, so I assume this language is as a catchall; for some future ...


1

The CRA is unusually clear on this: if you own a rental property with your spouse or common-law partner, you are a co-owner. Not "you may be" or "consider electing to be" -- you are. Be careful as you fill out the form, because you're mostly working with the total rent and total expenses, not divided by owner, until you get to the final ...


4

What you do with proceeds from a rental property are entirely up to you. As long as you pay any taxes due (and there are special rules for landlords who let property in the UK but live abroad), and have a contingency fund available to pay for any issues that come up (e.g. repairs, bills when there are no tenants, decorating, refurbishment, etc), then ...


2

Imagine that a married couple buys a house on January 1st 2001 for 500K and lives in it for 5 years. On January 1st 2006 they rent out the house. The market value of the house is 700K at that point. The house is rented out for several years and on January 1st 2011 the couple sells the house for 900K. Is the capital gain 900K - 500K or 900K - 700K (the house ...


0

I've been thinking of asking him the next time we meet in person to give me some sort of ID or proof that he really does own that property, though I'm sure that would seem like a weird thing for a potential tenant to ask. Of course. That must be the normal way of renting a property. Both parties exchange their IDs, check for counterfeition, acquire photo-...


0

The capital gain is 900k-500k, because they get no benefit from any "primary residency" that transpired more than 5 years before the sale. Determine whether you meet the residence requirement. If you owned the home and used it as your residence for at least 24 months of the previous 5 years, you meet the residence requirement. The 24 months of ...


2

Hmm, I can think of legitimate reasons for all of this. Meet at a public place: Maybe he's just being cautious. If he's living in this house and is renting out a room, maybe he doesn't want to give out his address to any random person who contacts him. He figures he wants to at least meet the person first. Generic application downloaded from Internet: I don'...


0

Your situation is complex because there are so many differences between you. I'll expand on Kaz's answer with a few more points. The first choice you two should make is how much of the house expenses you want to take on. This is not limited to the initial payment as house expenses are numerous and will come continuously, often unexpectedly. Keep track of all ...


Top 50 recent answers are included