Thanks for the video! Very helpful and educative for the beginners 🤟🏻
@ChadPavelcpa
2 жыл бұрын
Glad you enjoyed!
@peterjohnson765
22 күн бұрын
Hey Chad, I enjoyed your informative video. I recently bought a house and then in 2023 renovated and rented out a different house that I had lived in and owned for 38 years. Since I have owned the rental house longer than the 27.5 year standard term of depreciation, on what basis can I claim a rate of depreciation? The renovation in 2023 consisted of repairs-drywall, paint, carpet, some light fixtures, appliances, bath/kitchen fixtures, flooring, deck resurfacing, cleaning and powerwashing. The roof was replaced due to weather damage in 2021 mostly with insurance funds. The house was also significantly renovated in 1995 largely with insurance funds due to a fire from a toaster oven causing extensive fire, smoke and water damage. Due to refinancing I still owe money on a mortgage for about a third of the current market value of the house.
@serkanmehmetkaanbey214
3 жыл бұрын
Great video👍
@namita9031
11 ай бұрын
to the point great info
@SheridanRS
3 жыл бұрын
Thank you!!
@ChadPavelcpa
3 жыл бұрын
You're welcome!
@angiemeepster5559
9 ай бұрын
Hello, thanks so much for the info. I believe I qualify for the exception. I bought in 12/15/2017 and lived there as my primary until I rented it out on 01/01/2020. I rented until Jan 2022. I sold it on 08/10/2022. The house was vacant while listed. Can I still report a schedule E for the month of as rented? What is required tax wise for selling it while I had previously rented the house for 2 years?
@annestnntt
11 ай бұрын
Hey Chad, very informative video! I was wondering if your advice are transferable to Canadian owners experience? Would you be able to recommend any adviser that have an expertise for Canadians? Thanks
@mlnn2011
8 ай бұрын
Hi Chad, I bought a second home in 2021 pandemic and stayed there for 4-5 months, then I furnished, upgraded the home for vacation rental. Can I deduct all furnishing cost (furniture & setup for vacation rental) as expense from rental income, and also can I deduct mortgage and utility payment from vacation rental income? Total rented days has been less than 180 days per year.
@77777withlove
5 ай бұрын
Hello Chad, if I bought the house for 150k 40 years ago, and now I start renting it out. what value of the house do I use for depreciation? Thanks so much for your help Avatar image
@vegomatic100
2 жыл бұрын
Our primary and now rental home was bought in 1991and refinanced in 2005. We started renting the entire house in 2020. Can we use the tax assessed building and land values to determine the cost basis for depreciation? If so, do we use the values from the year the house was bought? The year we refinanced or; the year we started renting the house out? Thank you!
@ChadPavelcpa
2 жыл бұрын
You likely already filed your 2020 tax return this is where you should have addressed the land to building breakout. Using the assessment breakout between land and building is one way to do it and it is generally supportable. I’d check with your tax advisor or tax software to determine if you did it correctly. I cannot answer specifically
@Will-ds8kg
2 жыл бұрын
Hey Chad, can you deduct expenses spent on repairs on your primary residence in the month BEFORE you move out and convert into a rental? Or should I wait until I move out to get the tax benefits of these repair expenses? Thanks
@ChadPavelcpa
2 жыл бұрын
Depends on the repair type. Overhaul or simple maintenance? Repairs that improve the value of the home whether before or after you rent it increase your cost basis of the property. Kitchen, floors, paint, HVAC, roof etc. This means you have a higher amount to depreciate when you rent the home. Check us out at pinewoodfs.com if you want more substantial advice.
@elfpuncher
3 жыл бұрын
Thanks for the video! We're moving out of our house we've owned for two years and plan to rent it out. Based on what you've said, It sounds like there wouldnt be any reason to get an appraisal to determine the value for basis purposes if the value is going to go up, correct?
@ChadPavelcpa
3 жыл бұрын
When the property is sold the basis is calculated differently for gain or loss. When the property is sold at a gain the basis is the original cost plus amounts paid for capital improvements, less any depreciation taken. When sold at a loss the starting point for the basis is the lower of property original cost or the FMV at the time it was converted from personal to rental property. If the property is rented for three years or less then sold, you still may be eligible for the 250,000 gain exclusion or 500,000 for married filing jointly also if you occupied the home for 2 of 5 years prior to selling. - Per Marcum LLP
@JiveTurkeyAndMe
3 жыл бұрын
@@ChadPavelcpa I'm in a similar situation. I bought my home and (we) moved in 2011 at the bottom of the market in Phoenix, AZ. I married my wife in September of 2018. We listed it for sale in July of 2019 but after 6 months of no buyers we decided to rent it out in February of 2020 - March of 2021 after which we listed and sold/closed May 2021. Our gain was more than 250,000. Would we qualify for the 500,000 tax exemption even though we were not married when we purchased?
@dizluvjesus9695
4 жыл бұрын
When rolling over 90% of the selling price of a home to a home owned for ten years, is section 1031 applicable?
@ChadPavelcpa
2 жыл бұрын
First check with your cpa to see if you even have capital gains on the home. If you are selling a home you lived in for 2 of the last 5 years as your primary home then you may be able to exclude most or all of your gain on the sale anyway.
@roxannekoopman2066
Жыл бұрын
Hey Chad, Thanks for the video. Could you help me out with this question? I bought another house and paid it off in cash. I refinanced my primary residence to do it. I'm now renting out that second house. Can I use the mortgage interest on my primary residence as part of my loss for the rental house?
@ChadPavelcpa
Жыл бұрын
I’d check with a local tax pro on your specific situation. What you are asking is how can you justify treating the interest on your refinanced primary residence as investment interest because you used the loan to buy a rental property right? It will depend on the timing and order and possibly how the mortgage is categorized by your bank. But based on what you’ve described, you should be able to get either an itemized deduction for your primary residence or a business interest deduction on the rental property.
@martinbaldovinos792
3 жыл бұрын
Would I have to refinance my home to make it a rental property? And if I do can I write off tax deductions for closing costs, down payment, etc?
@ChadPavelcpa
3 жыл бұрын
You don't have to refinance for tax purposes. It is rare but your bank may require your home to be owner-occupied (although usually that only applies for the first 6-12 months you have the loan). If you move out of your home, and collect rent from someone else, your home is considered a rental property. If you choose to refinance you would usually do it if it resulted in a lower monthly payment or for a cash out refinance
@auntylizzyrocks
2 жыл бұрын
Sorry, a tad confused. You said basis when you convert the home to a rental is your cost to purchase home plus improvements minus depreciation. What depreciation?
@ChadPavelcpa
2 жыл бұрын
Depreciation is a method where you take a deduction on the total price of the house - but you take that deduction over time of 27.5 years. So if the basis is $500,000 then you take an annual depreciation expense of 500,000/27.5 = 18,181 per year. Check with your tax advisor to see how much depreciation you can take on your rental property once you start to rent it out.
@karyjimenez2472
4 жыл бұрын
I am planing to deed my property residence as an llc entity taxable as S corp. So my question is can I still be living on that property that will convert my my investment real estate So, I am planning to report rent since I am planing to live there. Is that make sense?
@Jessica-rh1wk
3 жыл бұрын
Hi Katherine, did you find an answer? Curious just in case I go this route
@richdibo
3 жыл бұрын
You don't want property in a corporation - S or C.
@christineyoung4349
2 жыл бұрын
Do I need to worry about it, if I only rent my room out? It’s my only primary resident and it’s because I couldn’t afford the full amount of Morgage payment.
@ChadPavelcpa
2 жыл бұрын
You must report your rental income on your annual individual tax return even if you rent one room in your home.
@nomadpocho6182
Жыл бұрын
Hey Chad, I would love a video on if I rent out a room in my house. Does opening an LLC work out in terms of the profit loss. Lots of mellenials are house hacking right now so I think this would be a great video for content. Great content btw!
@ChadPavelcpa
Жыл бұрын
An LLC itself doesn’t save you taxes vs renting out as an individual. If you personally own the house there is little reason to open an LLC to rent out a few rooms. Single member LLCs don’t save you taxes they are taxed the same was as a sole proprietorship too.
@nomadpocho6182
Жыл бұрын
@@ChadPavelcpa thanks for that. That’s exactly the amasser I was looking for. I’m still on the journey of buying more than one home for rentals.
@ryanthegamercmaa958
2 жыл бұрын
I build a apartment in my backyard and a studio in my garage can I deduct what I invested
@ChadPavelcpa
2 жыл бұрын
If you rent those units out you can get deductions for the portion of expenses like utilities taxes mortgage interest against rental income. You can also take depreciation on that portion too. You’ll want to work with a good tax advisor to find the right balance. But no you can’t just deduct all of the expenses of the construction all in one year.
@rick_the_agent3391
3 жыл бұрын
Wait so if I own a 6 bedroom and I rent 2 bedrooms can I apply a Sch E for those 2 rooms ?
@richdibo
3 жыл бұрын
Yes. However, you can't claim a loss.
@rick_the_agent3391
3 жыл бұрын
@@richdibo why is this?
@richdibo
3 жыл бұрын
@@rick_the_agent3391 Since you do not have separate toilet and cooking facilities, you have a single "dwelling unit" that is also your residence. The rental is subject to the "hobby loss" rules. This is somewhat complicated. google me
@ChadPavelcpa
2 жыл бұрын
Great points
@ordinary.millennial
2 жыл бұрын
@@richdibo I googled you and wasn’t sure if it’s the right linkedin profile. How much would be a session of consulting with you regarding this issue of turning primary residency into a rental property?
@samicrystal07
2 жыл бұрын
Is obtaining a rental license sufficient to convert home into a rental/investment property??
@ChadPavelcpa
2 жыл бұрын
I haven’t heard of needing a license to rent a home out, but check around to see if there is something specific required in your town.
@user-np6tf8zx1u
4 жыл бұрын
Is depreciation just applied like the deduction for operating expenses? Thanks!
@ChadPavelcpa
4 жыл бұрын
Jenna A there is a separate section and a special calculation.
@yourlogicalnightmare1014
2 жыл бұрын
Welp, looks like the government has stolen all my property rights. Apparently my tenant can pay zero rent for 2 years, I have to pay all his utilities then go through 3 months of eviction process. Thanks Covid 😃👍
@ChadPavelcpa
2 жыл бұрын
That’s a very difficult position to be in. Hope you can find a better tenant. Or try air BNB
Пікірлер: 52