can result in a great deal, but it's also easy to make a bidding mistake and end up paying too much or getting property you don't want. You'll sign papers for the property immediately, so bringing an attorney to the auction with you is a good idea. It's also a good idea to visit a few auctions as a…
Consult An Attorney When Dealing With Investment Property
A parent is helping his son and his wife purchase a condominium, which will be an investment property since he will not occupy the property. Because this is his first foray into real estate investing, he should consult a real estate attorney to guide him through the process. Some lenders will allow…
Rental Property Income Pays College Tuition
Can non-traditional methods, like income from rental property actually pay for college tuition? Income from a rental property - not just CDs and stocks can help you save money for your child's college tuition. After paying college tuition, the income from rental property can be saved for retirement…
Avoid Capital Gains Or Gift Tax On Real Estate Investment
What's the best way to pass a second home on to heirs? If you don't want to pay capital gains tax on a sale or a gift tax you should give your heirs an ownership share of the home gradually. If you give an amount of the real estate investment equal to the amount that's not subject to gift tax you…
Defer Taxes On Investment Property With 1031 Exchange
What should you do with the proceeds of a rental property sale? You can buy another investment property and defer taxes if you do a 1031 tax-free exchange. But to do a 1031 exchange you have to be very conscious of the timeline of your real estate purchases, otherwise you'll owe hefty taxes.
Investment Property At Risk Without Partnership Agreement
When you buy investment property with partners, it's best to draw up a partnership agreement which clearly describes everyone's responsibilities. When investment property partners don't live up to their end of the bargain you may have to hire a real estate attorney to help you sell the investment…
Save Taxes On Investment Property With 1031 Exchange
A profitable real estate investment in commercial or industrial property will result in a large capital gains tax at the time of sale. A 1031 exchange with financing is one way to defer tax penalties and obtain some cash immediately when selling investment property. When you do a 1031 exchange you…
Condominium Owner Must Pay Capital Gains Tax On Condo Never Lived In
If you buy condominium and sell without living it you must pay capital gains tax. You may also have to pay "short-term" investment taxes if you didn't own the condo for at least a year. You must pay the marginal tax rate, which could be as high as 35 percent because it's considered a short-term…
Purchasing Vacation And Investment Properties
The National Association of Realtors recently released a new study that looks at the vacation and investment home markets. Last year, 40 percent of all homes bought were vacation homes or investment properties. There is a clear distinction between the people who buy vacation homes and those who buy…
Investment Property Financing, Refinancing Rules Change
It used to be that you could apply for a mortgage for an investment property if you owned up to 10 properties. Fannie Mae and Freddie Mac have restricted their lending rules for investment properties so you can now only have four investment properties and get a mortgage. Learn why the rules changed…
A buyer is purchasing a piece of property that has been foreclosed upon, and his attorney represents both the seller and himself. It's possible that the attorney is representing the bank and not the buyer. In some states, attorneys act as closing agents and don't represent either party.
Flipping Real Estate Property: Options Include 1031 Exchange And Paying Capital Gains
There are several decisions to make when flipping real estate - should you pay capital gains tax or should you apply for a 1031 exchange, borrow against the property and keep the land. Having to pay capital gains tax may be a factor in a property owner's decision to keep the land and apply for a…
Title Company Can Resolve Quit Claim Deed
Regardless of whether you've been paying property taxes, to really be a property owner your name has to be listed on the property's title. In one family's case some land was signed over using a quit claim deed and one of the heirs is now unsure whether she's listed on the title or is the owner. It…
ThinkGlink Radio Show for Dec 22, 2008
Today on the Clark Howard Show, Ilyce Glink filled in. She talked about whether you should refinance your mortgage, how to finance investment properties, and what to do if your homeowner's association is making life difficult by raising fees. She also talked about buying foreclosure…
Real Estate Investment: Waiting For The Best Deal
Homeowners in some parts of the country such as Arizona, Nevada and Florida, are learning the hard way that their real estate investments may lose value. The growing number of foreclosures and short sales makes some wonder when the real estate market will hit bottom. If you're looking to purchase…
Taxes Affect Manufactured Home Refinance Decision
The owner of a manufactured home asks whether to pay off the mortgage loan or invest extra money. Since the manufactured home is a second home or investment property, the home owner should consider how his taxes will be affected. Tax software or a tax preparer before can help sort this out before…
Tax Deductions: Who Should Own Primary Residence
Does it make sense to have the title to a primary residence held by a limited liability company (LLC)? If your LLC owns a primary residence you may lose various tax deductions. It may also be more difficult to obtain favorable mortgage financing because a property owned by an LLC may be considered…
Real Estate Taxes: Can You Deduct Them From Inherited Property
The U.S. Internal Revenue Service allows tax payers to deduct some real estate taxes when they file. Can an owner of multiple properties deduct the property taxes from a recently inherited property? A Think Glink reader asks about deducting the property taxes from a property he inherited with his…
1031 Exchange: Deadlines, Type Of Property Impact Eligibility
A 1031 exchange allows you to buy and sell investment property within a specified time period and defer paying taxes to the IRS. Primary residences, second homes and vacation homes are generally not eligible for 1031 exchanges. Real estate market conditions may make it harder to sell a property and…
Buying A House? What Can Go Wrong.
Many things can go wrong when buying a house. You'll want to be sure to protect yourself so that nothing goes wrong when you buy your house, the biggest purchase you'll ever make.
Owner Occupied Status Affects Mortgage Refinancing
A renter asks about an owner-occupied requirement with regard to mortgage refinancing. The renter says his landlord has refinanced the property twice, each time claiming he lives there. The renter wonders if the landlord breaks the law by claiming the property is owner-occupied during a mortgage…
1031 Exchange - What is Cost Basis?
Learn how cost basis is calculated for a 1031 tax exchange. 1031 exchange expert Julianna A. Clementi-Ryan explains what's involved in determining cost basis.
1031 Exchange: What Is a Capital Gain?
When you're doing a 1031 tax exchange, you need to know what a capital gain is. A capital gain is a profit on a capital asset. Capital gains tax is 15 percent on real estate. But if you're doing a 1031 exchange with another type of investment you'll likely pay your ordinary income tax rate on the…
1031 Exchange: 3 Rules For Property
When you're doing a 1031 tax exchange you need to follow three rules for identifying property. The three property rule allows you to consider three replacement properties without taking their fair market value into account. If you're looking at more than three properties for a 1031 exchange, you may…
1031 Exchange & Capital Gains Tax
When you do a 1031 tax exchange it can save you capital gains tax and recapture depreciation tax. Taxes without a 1031 exchange can range 15 to 25 percent. They will be higher the more valuable your investment property or if you've claimed depreciation on the asset you're exchanging. Learn how to…
