Question : Understanding the tax shelter in investment real state...?
I'm a construction worker who bought and is rehabbing a building in my town. The building will be sweet when I'm done but I don't fully understand the shelter game, as in how will it effect my personal income(LLC)? The main question is how much will I make annually vs selling it outright for a profit.Conservative net income after debt service=$15,000Purchase price=$80,000Capital improvements=$30,000+Grant program(I have reciepts, they reimbursed me)=$30,000Depreciation=?Mortgage interest=$8,400 1st full yearTaxes=$6,800(accounted for taxes before computing net income)Could sell easily for $170,000 for profit of $60,000 before taxes.Would probably sit on it and try and get $200,000 for a profit of $90,000 before taxes.I borrowed $130,000. $80 to buy, $30 to rehab, $20 in oh no money.How much loss can I write off on my presonal taxes ie how big a loss can I show? House hold income is about $50,000. Bear in mind that I have about $20,000 in other Ded.s
- asked by cptviggi
All Answers:
Answer #1
I can recommend one thing...look into a "1031"through your title company and you can roll overcapital gains into a new property within (Ibelieve) 6 months... I know that isn't yourquestion, but it will help you out alot in thefuture if you continue rehabing buildings.
- answered by NY PTK
| 
measure and fulfill your financial needs
