Tax Expert?

[Chris]

Any tax experts here? As most of you probably Barb & I are both retired. We're looking at buying a partial investment property that we would rent when not living in it and are trying to figure out the best way to draw on our retirement funds to pay for it.

Non-professional knowledgable opinions welcome. :thumb:

We are past 59.5 so we don't have to pay early withdrawal taxes now though the friendly IRS just sent us a $2000 bill for not doing that last year. Damn, I forgot about the timing last year when Barb was still a youngster. :frown:

[Patrolman]

Chris, I know a couple different guys who do taxes, one who is a CPA. I can also provide some insight regarding retirement plan rules as I am in the industry. Let me know if you need to chat.

[Brody]

LaDawn has some good folks in her back pocket. Might shoot her an email or call her..

[glacierpaul]

I recommend doing a "vacation rental by owner" situation, if possible. Best scenario for renting, unless you know renters you can trust for 6 month to yearly leases. Even contacting a few other "vrbo" folks about how the investment is working for them, and how they set it up. If you were to do one up my way, I do property management too.

[CR]

My father owns his own tax firm. Give him a call and tell him I sent you.
Ray Athey
3036824385

[Java]

Wish I was retired, you lucky ducks. My accountant owns rental properties on the frontrange and in a ski area, he's done it over and over including buying / selling. I've been using him for 13 years and trust him, his name is Joe Baker, biz name is York Street, 303-238-8200.

[4runner freak]

Chris, I've got a great accountant that could help, or I'll help with the rental part as much as I can(We have 2).
Let me know if I can help(I've got leases).

[Chris]

Thanks everyone, I had one question that I got conflicting info on but finally figured it out. Google is great but sometimes provides too much information that's not real clear. Decided the IRS forms were the answer despite their inability to use language that is readable.

[Aaron]

Look up Passive Activity Losses. That is the big one for me. Unless you are a real estate professional, only losses up to the amount you make on the property can be deducted immediately. That is, if you rent your place out at $1000 per month, and you document expenses of 1100 (including your time, management, office expenses, mileage, mortgage, etc), you cannot deduct losses greater than the income on your rental that year. So, if you make 50K + 12K on your income property, but you lost 13,200 on your property, you can only deduct 12K of that loss this year. It's still a loss and you can deduct it later (when the property makes money or when you sell it) but not now.

There are some pretty good advantages if you use the property for more than 10% of it's rentable time. That is, it it is rentable all year (365 days) and you use it for more than 37 days, it is then mixed use which somehow makes it better...Go figure.

[Chris]

Interesting Aaron, wouldn't it be nice to deduct capital losses on personal real estate?

I've talked to people who do the VRBO thing Paul and the places we're considering rent easily for both short and long term since it's in Maui. We would probably stay 6 months + a day to be residents then rent the remainder of the year.

Other Paul, lucky? Hell no, we earned this. We'll be lucky if we don't run out of money though!

[glacierpaul]

Rental in Maui!?!? SWEET!!

[Chris]

Our son lives there so we'd have some extra yes on it if we can work it out. :thumb:

[Popsgarage]

Kihei here we come!!!

[Chris]

Exactly Jon, I don't know about you but this is very appealing.

[Popsgarage]

Big Beach. Ah, memories!