Chat 9-19-05 with Gary Mathes, CPA
Posted on September 19, 2005
gary_mathes: Hello
Mike_Summey: I’m here
Mike_Summey: summey
Mike_Summey: *choochoo*
molamoladiver: Hello all
molamoladiver: Hi DC
DC: How are you?
molamoladiver: Fine how are you. Looks like we may be earsly
DC: I was actually just seein if java works
DC: Have you bought any properties yet?
molamoladiver: No, I’m just starting off.
molamoladiver: how about you??
DC: I got my first offer accepted
molamoladiver: Wonderful! contratualations!
molamoladiver: how did you choose a property?
DC: Well there is an MLS for my area on the internet
DC: saw the listing called the broker, he woked as a duel agent
molamoladiver: That’s great.
molamoladiver: right now I guess my goal is to learn more and start
working on finances
DC: it is 3 unit for 106000 cash flow should be like 300 a month
molamoladiver: what area are you in?
DC: Grand Rapids MI
DC: You??
molamoladiver: I’m outside of Raleigh, NC
DC: ughh gettin rain??
molamoladiver: no, the storm was about 100 miles for here
DC: When I was little I lived in Georiga and I thinK hurricane gloria Was
the name if the hurricane that hit not fun
molamoladiver: Yes, I lived in Baton Rouge during Andrew
molamoladiver: but I was hoping to got to the Keys this weekend
molamoladiver: I think that may be out of the question
DC: bad weekend to try that 
molamoladiver: yup!
DC: I gotta go see in about 20 minutes
molamoladiver: okay, see you then
DC: 
Mike_Summey: Hi everyone!
Ralph_Roberts: Hi guys!
gary_mathes: Hello Mike
Ralph_Roberts: REQUIRED DISCLAIMER: To ensure compliance with
requirements imposed by the IRS, we inform you that any tax advice contained in
this communication (including attachments) is not intended or written to be
used, and cannot be used, for the purpose of avoiding penalties under the
Internal Revenue Code.
Ralph_Roberts: that what ya need?
Mike_Summey: Thanks Ralph!
Mike_Summey: That’s Gary’s CYA message.
Mike_Summey: Gary, things will get wound up in a few minutes. Until then
we just chit chat a bit.
gary_mathes: Thanks to the recent kpmg issues and other prior problems
Mike_Summey: Hi DC
DC: Hey mike!!
Mike_Summey: Hi Bob
ritchie: Hi Mike
Bob_Carr: Hi everyone
Mike_Summey: r called a bit ago, he will not be with us tonight. He is in
Canada and does not have Internet access.
Mike_Summey: Roger
Mike_Summey: Hi Dhan
DHan: hi mike!! its dave hancock from burlington
Mike_Summey: Hi ritchie, I misse dyou.
Mike_Summey: Hi Paul\
DHan: hullo everybuddy
Paul_CA: Hello Mike
Mike_Summey: Hi Sam
Sam: Hi!
Mike_Summey: ’s chat is going to be a good one. Gary is full of great
information…among other stuff!
DHan: excellent
DHan: i always love getting $300 an hour advice for free 
Mike_Summey: Ralph, why is the program cutting off the first few letters
of my typing?
gary_mathes: I’ll send Mike the bill
DHan: hehehe kewl
Ralph_Roberts: Don’t know… it’s seems to be working okay here.
DHan: you live in asheville gary?
Mike_Summey: Hi molamoladive. You’ll be know as Mo for tonight’s chat.
That other name is too much to type.
Mike_Summey: Hi Al
molamoladiver: sure, no worries
Al_Lee: Howdy
molamoladiver: Hello all
gary_mathes: DHan, I actually live in the small town of Weaverville, but
just short hop from Asheville
Mike_Summey: DHan, $300 advice? I think Gary is $500!
gary_mathes: I think I just got a raise
Mike_Summey: It’s just now 8:00, so let’s get started with some questions
for Gary before the chat gets too full.
DHan: hey mike, do you want to use my teleconference system for tonites
message, its free!!!
Ralph_Roberts: since some new folk have logged in: REQUIRED DISCLAIMER:
To ensure compliance with requirements imposed by the IRS, we inform you that
any tax advice contained in this communication (including attachments) is not
intended or written to be used, and cannot be used, for the purpose of avoiding
penalties under the Internal Revenue Code.
Ralph_Roberts: (I am the official disclaimer spouter tonight)
Mike_Summey: DHan, we’ll be fine here. This gives us a written transcript
of everything that’s said so it can be posted for others who couldn’t make it to
read.
Mike_Summey: Hi Bruce
DHan: sure
Ralph_Roberts: hi Kim!
Bruce: Hi Mike
Mike_Summey: Hi Kim
Mike_Summey: Who has a burning question for Gary?
Kim-OH: Hi Ralph!!!
Mike_Summey: Batter up!
Kim-OH: Hi Mike thanks for arranging for Gary to join us
Al_Lee: Mike, I tell people all the tiem that when they start investing
in real estate one of the most importatn steps is to find a good cpa. That means
one who understands real estate. In my experience, only a minority of CPA
understand real estate. Ther eare so many tax benefits to real estate that it is
a great shame to lost them because your CPA only understands mutual funds. Do
youaagree?
Sam: Hi!
Mike_Summey: I agree Al! What’s your thought on that Gary?
Mike_Summey: Hi Eddie
Sam: Gary, thanks for sharing your expertise with us! My two brothers and
I recently purchased a fixer-upper. We’ve spent the past two months fixing it
up and are now selling it. In fact, just today we received an offer we think
we’ll accept. (btw, we all want to hold rentals long-term, but we’re
flipping this one just to raise some capital.) Anyway, I’m interested in the
tax ramifications. We’re not a partnership, just three separate estates. Can
you comment on issues we should be aware of when we’re filing our tax returns
next April? Do we each just report our 1/3 gains as a short-term capital gain,
etc? Thanks again for the advice…
Bruce: Gary, Is there a tax advantage for a Land Trust versus an LLC or
llp?
gary_mathes: I would certainly think that if you are getting into real
estate investments your CPA should have knowledge in that area
Eddie-WV: Hello Mike…how are you?
Kim-OH: Gary how does one make certain that a CPA does understand the
nuances of RE investing?
Mike_Summey: Hi JD
ritchie: looks like Gary has his hands full already
Mike_Summey: Hi regionkink, welcome
DC: Gary can you break down deprciation for me I’m not quite sure I
understand it
DHan: ill hold my question a bit
regionking: thank you
gary_mathes: Sam, you would be treated as having sold an undivided
interest so each of you would have aq cpaital gain equivalent to you respective
interest and it would be short term
Mike_Summey: Hang on guys…and gals! Let Gary catch up.
Al_Lee: Of course, I shoudl add: those terrific benefits go to the peopel
who hold real estate,not to peopel who buy and flip.
DHan: teehee
DHan: Al_lee….king of the buy and hold
gary_mathes: Bruce, I think you question would depend on state law to
some degree but I beleive the treatment would be similar. It may make some sence
to check with your attorney on that one also.
DHan: translation……land trusts are a wasssste of time
Al_Lee: DHan: I am a minor king copared to Mike, who has never sold a
single property–ever!
Mike_Summey: Al, did you see the posting Ralph put on the home page about
the Southeastern Booksellers Association meeting in Winston-Salem this past
weekend?
ritchie: Sam, if you need to cash out, why not take an equity loan, and
wait until the capital gains are long term?
Al_Lee: Mike, I did not. I was out of town on an Indian Princess campout
with my 7-year old and just got back
gary_mathes: Kim, the only real way to know is to see how they react to
situations that arise in your business, if you get uncomfortable maske a change.
A good recommendation to begin with also makes sense
Ralph_Roberts: hi Penny!
Bruce: Gary, thanks, also, if I own an apartment building in an llc,
would it be to my tax benefit to own the property management co. under a
different name if I was part owner of that entity as well?
Penny: Hi Ralph!
Mike_Summey: Al, it’s posted on the home page. I had fun at the meeting
and learned a lot about how books are sold.
Kim-OH: Gary, thanks for answering my question
Kim-OH: Hi Penny
Penny: Hi Kim and everyone.
Al_Lee: Mike, I’ll take a look after the chat.
Mike_Summey: Hi Penny
gary_mathes: DC, depreciation is basically the spreading of the cost of
an asset over it useful life. Useful lfe for tax purposes is defined by the tax
code for exam ple residential real estate usefule life is 27.5 years
DHan: ok, heres a good question, I have an apartment complex that I own
on my own. Well, my regular partner in reaql estate stuff wants to buy into it,
so im going to add him to the deed and let him give me 50 grand…. is this a
sale? how do i treat it for taxes?
Eddie-WV: Mike, I know that you let a management company handle
everything for you with the properties you own. Do you also let them pay your
mortgage/taxes/insurance?
gary_mathes: Bruce, I think generally it makes sense to hold your real
estate in a entity separate from you active business
Mike_Summey: Eddie, I pay mortgages, taxes and insurance…the important
things…the property management companies pay everything else.
Mike_Summey: Hi Ray
Eddie-WV: Good. I was a little concerned about handing over that to
someone else.
Mike_Summey: Gary, I forgot to tell you that these chats will expose your
typing skills, but in the long run will make you better.
DC: does anyone here have any section 8 tenants
Sam: Gary, thanks. So if we clear $30K on the sale of the house the three
of us just claim our $10K as a short-term capital gain. Simple. Except for the
paying part.
Ray_NC: Hi Mike
gary_mathes: I’m have just found that out.
Al_Lee: DC, I have soem Section 8 tenants
DHan: i luuuuuv sect 8
DC: Was it difficult process getting them in??
Mike_Summey: DC, our friend Carleton Sheets likes Section 8 tenants very
much. I don’t. Personally, I’ve not had good experience with them.
ritchie: Gary, and all: I own a rental property that was my primary
residence. I’d always assumed that I would sell it within 3 years after moving
to qualify for the capital gains exclusion. However, I will still have to pay
the government back 3 years worth or recaptured depreciation. An investor friend
suggested why sell it? Why not keep it or do a 1031 exchange? Would I someday
have to pay back recap and capital gains? What if I keep it until long in the
future and pass it along to heirs?
DHan: gary did you see my question?
Al_Lee: The key to Section 8 is having a proeprty manager who knows the
system and has experience and a working relatinsip with the admisinstrators in
all the towns and coutnies around you.
ritchie: Sam, yes. Why do you have to flip that property? why not rent
and hold for a while?
Ralph_Roberts: REQUIRED DISCLAIMER: To ensure compliance with
requirements imposed by the IRS, we inform you that any tax advice contained in
this communication (including attachments) is not intended or written to be
used, and cannot be used, for the purpose of avoiding penalties under the
Internal Revenue Code.
gary_mathes: DHan, I thought I answered one of yours I may have missed a
second one
DHan: oh ok
molamoladiver: Yeah! Ralph!
DHan: sk again
Mike_Summey: ritchie, if its making money why would you want to sell it?
When you sell you cap your profits and have to pay tax. The longer you keep it
the wider the profit margins become.
Mike_Summey: Hi Shane
Bruce: Gary, if I have a house that doesn’t rent for 30 days, can I write
that off as an expense? Also, if I evict a tenant for non-payment, can I write
off the non-payment? Can I get any type of tax break assuming either of the
above circumstances mentioned?
Ralph_Roberts: everyone must have a function, mine is to disclaim ;>
DC: Al I manage my own properties I was just wondering if it was a
headace witht the extra papre work and inspection
Al_Lee: ritchieL you might be able to keep it "forever" and
leave it to your kids in yoru estate and hav eit revalued at fair-market-value
for their cost basis whcih might forever avoid paing any capital gains tax.
Gary, asm I close there?
Eddie-WV: Mike, I have used the questions you suggest in Weekend
Millionaire for potential property management companies, I’ve also gotten their
agreements to look over. Is there anything specific you look for in these
agreements besides and "out" clause for you in case something goes
wrong? Would you suggest having an attorney to review them?
gary_mathes: Ritchie, If i understand your question, yes you would have
to consider the depreciation in calculating the gain on a personal residence. I
would think depending on the potential for gain exclusion you probably should
not condsider a 1031.
Shane: Hi Mike
Al_Lee: DC, yes ti is a headach, but not for me. My manager does it. That
also gives me a layer of separatin for liability. My manager has gazillions of
dollars of liability insurance.
Sam: Ritchie, we don’t want to hold this one as a rental because none of
us want to hold anything long-term together. We want to stay friendly with each
other. Since we want to sell it it seems like it would be easier to market it
with all new stuff in it instead of used carpets, etc, with an untidy renter…
But I’m curious about your long-term equity loan you mentioned… How would that
work?
gary_mathes: Bruce, if you have a rental property, you can write off the
expenses during periods of vacancy
DHan: i own an apartment complex, my partner wants to buy into it, so i
thought id just add him to the deed and let him give me 50k ….is this a sale?
how do i treat it tax-wise, is it only half a sale for me?
Mike_Summey: Eddie, I’d make sure the agreement includes a clause that
requires the management company to send a representative to accompany each
showing. Some want to sit in the office and give the prospective tenant a key to
go look on their own.
gary_mathes: Al Lee, you do get a "stepped-up" basis to fair
market if property passes through your estate
Eddie-WV: Thanks. Good idea!
ritchie: Sam, nothing magic. I was only suggesting you hold it and take
out a loan instead of flipping it. Sounds like you guys are not interested in
renting, so no point in holding
DHan: yeah just 1031 exchange everything till you or spouse
dies…..stepped up basis occurs at spousal death right?
Bruce: Gary, so I’m clear, the mortgage payment is this case would be
considered an expense, correct?
gary_mathes: DHan, stepped up basis depends on who holds title to the
property. If it is jointly held and your spouse dies you get a stepped basis
only for his or her interest
Mike_Summey: Bruce, only the interest portion of the mortgage is
deductible.
DHan: did you see my question about the apartment comnplex gary? i asked
it again
Mike_Summey: Gary, look up a DHan’s question about selling an interest in
a property.
DHan: hehe
gary_mathes: Bruce, the mortgage payment itself would not be considered
the expense, only the interest portion of the payment
Al_Lee: Mike, well, if it is escrowign taxes and insurance those portions
are expenses too, arent;t they?
ritchie: Mike, Gary, regarding Bruce’s question: what about utilities,
marketing costs, cleaning, lawn maintenance, etc?
Mike_Summey: Al, that’s true. Taxes, insurance and interest are all
deductible whether or not they are escrowed.
DHan: heck yeah all that stuff is deductible
gary_mathes: DHan, that would be a sale of a 50% interest and would be a
taxable event.
DHan: so figure out my gain, divide by 50%?
DHan: errrrr, what if i neglected to do a regular closing…..
gary_mathes: ritchie, you would still deduct those costs as long as the
property was being held for rent
DHan: just list it on taxes?
Mike_Summey: ritchie, utilities, marketing costs, cleaning, lawn
maintenance and every other actual expense is deductible.
Eddie-WV: Mike, I thought I read in a transcript of a previous chat that
software was in the works that would give NOI…or different scenarios that
would fall within your NOI for a property? Can you tell me if something like
that is being worked on?
gary_mathes: DHan, sales price less basis times 50%
Mike_Summey: ritchie, as long as you are holding the property for rent,
the expenses are deductible whether or not it is rented.
Al_Lee: Mike, gasoline to drive aroudn looking at yoru properties, or
airfare to fly to go see them is deductible, too.
gary_mathes: Al Lee, your right, but you may want to think about mileage
ritchie: Al, what do you deduct it from? Do you list it as expenses for
an existing rental?
Eddie-WV: Al_Lee…do you invest in properties outside your immediate
area?
DHan: im not sure if any one answered whether a vacant apartments
unrealized rent could be deductible
Mike_Summey: Eddie, the program is nearing completion. Hopefully it will
be ready soon. We’re in the debugging process now. The program is awesome. It
will allow you to produce a written offer in less than five minutes.
ritchie: E.g., if I go to the coast to evaluate property, but don’t buy
anything, how do I expense that?
Mike_Summey: Hi Peter
Al_Lee: Mike, the only portion of the ordinary mortgage payment that is
not deductible is the principal reduction–that is one reason why I like
interest-only loans. I am not paying any principal reduction!
Peter: Hi Mike, Al, Roger, Eddie and everyone else on chat today
Peter: Sorry I got late…just reached home
DHan: ritchie, just pick up a couple business cards of people you talked
to about real estate, or MLS sheets of places you went to look at, i do it all
the time….legitimately
gary_mathes: Dhan, on the vacant apt. the lost rent is not a deduction
assuming you are a cash basis taxpayer
Al_Lee: Eddie, I will buy anywhere in Texas if I have a good manager to
handle it. I won properties in several Texas cities
DHan: thx gary
Mike_Summey: Gary, why don’t I deduct mileage or airplane espenses to go
look at properties?
JD: What will be the cost of this program
DHan: Al you need stuff in north carolina….ill manage it for you
Eddie-WV: wow!!! I like that. I’ve been working the numbers on 4
different multi-units that I looked at over the weekend and it is time
consuming! I’m sure it will be on the website when it’s ready to go?
Mike_Summey: Hi BB
gary_mathes: Mike, you can deduct actual expenses or mileage. It can be
allocated to a specific property or spread between properties
Eddie-WV: Al_Lee…what do you mean you "won" properties in
several Texas cities?
Mike_Summey: JD, we haven’t priced it yet. There’s still work to be done
and I want to know what we have in it first.
ritchie: DHan, where do you itemize that expense at tax time?
JD: ok
JD: thanks
Bruce: Gary, what do you mean cash basis taxpayer?
gary_mathes: ritchie, Schedule E for the rental expenses
DHan: i put it in business travel expenses
Mike_Summey: Eddie, Al can’t type. He’s a computer geek! He meant own.
ritchie: So Gary, if it turns out you don’t buy, you can still distribute
that expense of going to look against existing properties?
Al_Lee: DHan, let’s talk! I need to make positive cash flow on all
proeprties. IF you can get me that I can buy (and lead my club members to buy)
an unlimited number of properties. The key is they must positiv ecash flow. My
rule of thumb is a maximum pric eof 100 months rent for a proeprty in good
shape.
Mike_Summey: Hi Brian
Eddie-WV: hahaha! Thanks Mike.
gary_mathes: Bruce, you report income when you get it you deduct expenses
when you pay them. I don’t know of very many accrual basis individual taxpayers
ritchie: Mike, will your NOI software run on a Palm?
Al_Lee: Eddie, Mike is correct, I "own" properties in…
Mike_Summey: ritchie, I don’t know! I’m not a computer geek! Ask Ralph!
ritchie: Ralph??
Bruce: Al, what is the thinking behind a max. price of 100 months rent
for a property in good shape?
JD: have to write in java
Bruce: Gary, got it
ritchie: Feature request - I own a Palm handheld computer. Would be great
if the software will run on that device
Ralph_Roberts: it will if it’s written for it … isn’t your programmer
using Java, Mike?
DHan: Al, right now im putting together a 60-unit apt complex
deal….want in on that?
ritchie: I will buy it!!!
Eddie-WV: Al_Lee…are you and your investors interesting in investing
out of state?
Shane: My brotherinlaw called this morning and has an extreme amount of
mony in a c orp and want to get into realestate with me, question; if he is to
get the mony out to partner up with me which I have an llc. would have the
property be be taxed as an c corp and half llc?
Brian-ON: Hi Mike…guys
Mike_Summey: Yes Ralph, it’s runs on Java. I do know that much.
gary_mathes: ritchie, I thought you had asked about existing rentals. For
potential acquisitions you may be able to deduct thopse expense as miscellaneou
itemized deductions on schedule A
JD: in java
Ralph_Roberts: then it should run on Java-enabled Palms or any other PDA
… Java is non-platform dependent
Mike_Summey: Hi bcunningham
JD: correct
Al_Lee: Bruce, where I buy I can find proeprties that will rent for at
least 1% of the purchase price. At that rate, they will nearly always cash flow
well using ordinary long-term financing. That is my criterion–cash flow, but
without using adjustable rate mortgages or other short-term tricks to fool
myself into buying a poor property
ritchie: Gary, that is what I thought, and on Schedule A, it is subject
to limits, correct?
DHan: al, you and i have almost identical philosophies
gary_mathes: Shane, if your brother in law has earnings accumulated in a
C Corp it will hard for him to get it out without a tax bite. He should get some
specific advice on that one
Eddie-WV: Mike, I have an LLC that I started after I bought my first
property. I have only bought in my personal name so far. At what point should I
go to the banks and try to purchase in the business name?
Shane: Gary , Thanks
gary_mathes: ritchie, schedule A miscellaneous deductions are subject to
a 2% Adjusted gross income limit
Brian-ON: I’m not very well versed in mortgages that come from the
USA..can you tell me how most of them are structured? In Canada they can only be
locked in for 5 years..if you lock in in the USA ..how long can you insure the
rate for??
Al_Lee: DHan, if you will contact me later via my website we can discuss
possibilities. go to http://www.RentHouses.org and click on "email Al"
anywhere on the site. It will get to me and I will respond.
Kim-OH: wb Ralph
Mike_Summey: ritchie, the way the program will work, it won’t be much
good unless your Palm is connected toa printer. The program actually produces
the offer letter ready for your signature.
Ralph_Roberts: REQUIRED DISCLAIMER: To ensure compliance with
requirements imposed by the IRS, we inform you that any tax advice contained in
this communication (including attachments) is not intended or written to be
used, and cannot be used, for the purpose of avoiding penalties under the
Internal Revenue Code. dance
ritchie: Mike: sounds neat, can’t wait to get it.
Eddie-WV: Al_Lee…when you say long term fiancing…do you mean 30 year?
DHan: ok al
Mike_Summey: Eddie, do it now. All the bank is interested in is your
guarantee of the loan, not whether the property is in your name or the LLC name.
BB: Gary: We lease option our properties and are out in 2 years . Our
down pmt, mo. cash flow and gain at sale and are taxed as a non istallment sale
in our llc. Am I correct?
Mike_Summey: Hi malpaso
Al_Lee: Gary, it seems that if these guys are using an entity to buy
properties into, any travel to lok at properties woudl be a legitimate business
expense. No?
Mike_Summey: Hi Irv
Al_Lee: Eddie, Yes, I mean 30-year fixed-rate. I often also use the
interest-only option to boost both long-term and short-term roi, too.
DHan: i want 30 year interest only on my apartments
Eddie-WV: Thanks Mike…are there advantages to doing it this way besides
the fact that my personal assets are protected?
gary_mathes: BB, I’m not exactly sure what you are doing but the tax
treatment will be guided to a large degree on your contractual arrangements
Al_Lee: DHan, I do not know of a lender who will do 30-year fixed on
commercial proeprties–only residential.
DC: al lee are you the voice on our website??
Mike_Summey: That’s correct Eddie. The LLC provides some asset
protection, but I think the estate planning aspects of holding the properties in
an LLC outweighs the other advantages.
DHan: i gota lender that will do 25-year am , 5.75 fixed for 5 years :0
20% down
gary_mathes: Al Lee, you are correct. If an LLC for example is the
purchasing entity, the LLC could deduct some of those cost without limitation.
But the LLC would have to pay them, ie pay the members mileage or expenses
Eddie-WV: Al_Lee…the interest only option is nice…but at what point
do you switch it over so you can start paying down the mortgage?
Al_Lee: DHan, by commercial I mean to include multi-family (over 4
units), because the loans are different from ordinary home mortgage loans
Mike_Summey: Hi Bob
DHan: gotcha al
Shane: Dhan is that commercial
Bob: hi
DHan: dont worry about estate taxes, just time it so you die during 2010
and youll be OK!
Mike_Summey: Gary, having fun yet?
malpaso2001: Hey Mike
DHan: yes, commercial loan
gary_mathes: More hectic than I expected
Al_Lee: Eddie, you need to read my articles and listen to my readio
broadcasts. I never care to pay down the mortgages. I only do it becaue the bank
insists. I am using their maony at 6-7% and making 35-50% returns with it. Why
be in a rush to end that relationship?
DHan: 25 year amort, 5.75 fixed for 5
malpaso2001: Hey Mike
Mike_Summey: Hi Andhe
Shane: wow! Do they need more buisness?
Eddie-WV: Al_Lee…good point!
DHan: sure they do
Shane: I am doing 20yr. fixed 5 for 1 over prime
JD: radio LOL
Eddie-WV: Where do I find your articles?
ritchie: Al, you realize that is contrary to the weekend millionaire’s
advice?
DHan: both philosophies work
Shane: How do I get in touch with them
Brian-ON: Gary..I’m a Canadian Citizen who is getting his US Tax ID
#…I’m closing on a condo that I’m flipping for some positive ca$h and want to
keep the money in my USA bank account. DO you have any recommendations regarding
how to best protect myself tax wize?
BB: Gary; We lease the house with an option to buy. Two contracts, a
lease and an option agreement. We get $5K down, $250/mo.pos. cash flow rent for
24 mos. and then sell the prop. at end of the option period for a gain over
basis of approx. $30K. All in our llc. How would the IRS treat each event?
ritchie: the weekend millionaire eventually owns his properties
DHan: where u live shane?
Shane: Kentucky
DHan: al owns his to……20% of them
Al_Lee: ritchie: Mike and I have done nearly hour-long discussions on air
over that very point. We disagree on that aspect of real estate investing. We
are both right, though. We both managed to retire early on our holdings and are
financially secure without having to work. that is the goal, isn;t it?
DHan: might work, email me at david@timepropertiestoday.com ill hook you
up with them
Mike_Summey: ritchie, Al & I differ on the payments options. I like
to get them paid off as soon as possible.
regionking: Is there an advantage in putting my personla home under the
LLC as well?
ritchie: I can see, at least early in one’s career, taking cash out in
order to aquire more properties
Mike_Summey: regionking, who are you asking?
Peter: On this subject I am with Mike
regionking: Mike _S
ritchie: Mike, that would be a weekend millionaire strategy?
Peter: I would like my properties to build up equities faster by paying
up the principal
Eddie-WV: Mike, you mentioned in an earlier chat that you combine your
property managers’ monthly report with your own information and send your banks
a copy of this each month. What information does this include? I’d like to start
doing this also.
BB: How can you put your personal res. in an llc?? Is it a business as
well??
gary_mathes: Brian, I am assuming that the condo is US property. You
would be taxed on that sale in the US and most likely in the state in which it
is located. If you have to pay tax in Canada you would most likely get a foreign
tax credit for the US tax you paid. I’m using a lot of most liklies here but a
lot is guided by tax treaties I may not be familiar with
DHan: it depends….if you were running a corporation, you wouldnt make
decisions based on your individual age
Mike_Summey: Gary, can you answer regionking’s question about holding
your personal residence in an llc. I don’t wee much advantage to it, do you?
Al_Lee: Mike, if you did put your personal home into an llc you worul
lose the homestaed protection and tax breaks
regionking: thank you, guys
Mike_Summey: Al, many states do not have homestead exemptions. SC does,
NC doesn’t.
Peter: Gary I have a specific question on LLC Vs Not. What are the
deductions one misses out when one holds a property under personal name and not
llc?
Al_Lee: DHan, I agree with you. Age has nothing to do with it. Higher
returns are good at any age.
gary_mathes: BB, it appears to me that the lease portion would be treated
as rental income. The option premium would be a capital gain at the time of the
lapse of the option if it is not exercised. If it is exercised it would be
treated as a sale
Peter: Al what is homestead protection and what tax breaks are you
referring to (the one we get at the time of selling?_)
Al_Lee: Mike, I didn;t know that. I thought they all did. Oh, well. Texas
does and the protections from having your homestead attached in a lawsuit are
very strong, too.
gary_mathes: Mike & regionking, I see no benefit to holding a
personal residence in an llc. Could eliminate the potential for gain exclusion
on sale
Al_Lee: Peter, In Texas you get a lower property tax for yoru homestead
and protectin against having it taken in a lawsuit
BB: Gary: For estate tax purposes, NC and federal, is limited fam.
partnership best route along with the appropriate trusts?
Mike_Summey: Eddie, I almost missed your question. I send my banks a
complete report each month on all income and expenses. Gary gets a copy of it
too. Gary will you comment on its value?
Brian-ON: Thanks Gary
Mike_Summey: Hi JS
Ralph_Roberts: it’s that time again dance dance dance
bcunningham: gary, for us that are new to this. what are some of the
wright offs that we can look forward too this year. I have heard that I can do a
one time write off of all my tools. If my year end taxs is negitve should i hold
off untill the foolowing year to claim the credit?
Ralph_Roberts: REQUIRED DISCLAIMER: To ensure compliance with
requirements imposed by the IRS, we inform you that any tax advice contained in
this communication (including attachments) is not intended or written to be
used, and cannot be used, for the purpose of avoiding penalties under the
Internal Revenue Code.
Mike_Summey: Hi Andrew
gary_mathes: Peter, LLC vs. Non LLC dedeuctions are usually the same for
income tax purposes. Asset protection and estate planbning are more of the
drivers of that decision
Mike_Summey: Hi ncwoman
Peter: Al….is this automatic when you declare that a property is owner
occupied
JD: what is dance dance dance ???????
Mike_Summey: Al, in SC the homestead exemption only applies to the home
in which you live, not investment properties.
Ralph_Roberts: dancing elephants emphasize the disclaimer
Al_Lee: Peter, it is nearly automatic, there is a simple form to fill in,
but it usually is done at closign when you buy. It can be done later, too.
Peter: Gary, I heard that there are more deductions available when you
hold a corporation than to w3 taxpayers
JD: lol\
BB: Never, never, hold a property in your name– absolute liability and
total exposure to your personal assets , even if in a trust!!! Gary, may not be
qual. to agree but I would ask his op. as well.
gary_mathes: BB, Family partnerships are generally used to gift minority
interests and acheive discounts below the contol value
ritchie: Gary, can you elaborate on the estate planning benefits of an
llc?
Peter: Al is there a way to convert a owner occupied to Rental property
is there another form one needs to fill
Al_Lee: Mike, yes, I was talking about the home in which you live. That
was how I understood the question way, way back there in the chat
Ralph_Roberts: the IRS may make us do it, but we can still have fun dance
Rob_L: Al, what are the main ways you are finding properties for your
‘turnkey investments’ on your site?
Al_Lee: Peter, yes, you must advise the taxint authorities that this is
no longer a homestead. it is a simple form, too.
Eddie-WV: Gary, Mike sends his banks a report each month detailing all
income and expenses, what is the value of doing this?
ritchie: Peter, when I started renting my previous home, I did not fill
out a form. I just started keeping receipts, in a folder
ritchie: I called my insurance agent, and let them know the property was
a rental
Andhe: oh oh .. whats this total absolute liability and total exposure if
you
Peter: Ritchie based on what I just heard the taxes are different…then
I think it may be necessary to fill up that form
Ralph_Roberts: we are up to 30 people tonight now … a good chat
gary_mathes: bcunningham, the write offs would be the normal expenses you
would incur on a rental such as repairs, interest taxes, wrting off tolls can be
accomplished through a section 179 deduction or if they are minor just a
deduction
Mike_Summey: Hi briefcase
ritchie: and I purchased a $1 million personal umbrella liability policy
Eddie-WV: Mike, little off the subject, but what part of WV are you from?
Al_Lee: Rob, I have several good sources for properties and they all
bring in deals regularly. They make monty for doing that, so they are eager to
bring me more and more.
Andhe: if you have it in your name .. not what the wize man Hancock told
me
Peter: or in case of Audit that may be a problem
Peter: Does anyone has link to that form on the internet
Mike_Summey: Eddie, WAR
gary_mathes: Peter, I don’t beleive the deductions would be any differnt,
legal issues will be
Mike_Summey: Southern most town in WV
DHan: heheh they dont know what the heck they tralkin bout!
Peter: Ritchie, so do you think Insurance agent takes care of that form
BB: Andhe: you have no protection of personal assets if insurance limits
are breached!! Total exposure, personally.
Peter: Thanks Gary for clarifying that
Eddie-WV: Cool. I live in Parkersburg. My father’s family is all from
southern WV also.
Al_Lee: ritchie, you need to advise teh county that the property is now a
rental so that they update their records–if yoru state gives a reduced tax rate
for homesteads.
gary_mathes: ritchie, estate benefits of an LLc usually come from gifting
minority interest before death
Rob_L: Gary, I just bought a rental property late last year. How would
you enter that in the journal entries?
Peter: Gary what is minority benefits
DHan: BB, HOW DO YOU GET loans IN llc name?
Mike_Summey: Eddie, get a copy of Weekend Millionaire Mindest and read
it. You will learn the whole story.
BB: Gary: Do you currently know of any offshore tax havens for US
citizens??
gary_mathes: Eddie, they like it and can follow what he is doing.
Therefore easing financing on future acquisitions
Peter: dhan that is very difficult….unless you have a history of profit
loss statement for your business
Peter: Usually lenders dont like to loan for a property on a business
DHan: Reason why i have bought stuff in my personal name is easier
financing, then i carry a boatload of insurance
Eddie-WV: I have it. Just bought it when I was on vacation in Florida
last month. I’m on page 37 right now.
BB: DHan: No prob. with my local bank if stickbuilt. Not on dws. Always
on my commercial line.
Mike_Summey: Eddie, I send Gary the report so he can keep an eye on my
potential tax liabilities throughout the year.
DHan: you gotta be pretty negligent to get sued for over 1 million
Peter: BB are you thinking of investing offshore
Al_Lee: BB: I believer there is still a place on yoru Form 1040 that asks
if you have any money or assets held offshore. If you are caught lying on that
form i t is a felony. So much for tax havens.
Andhe: have been advised to buy in llc, but still get loan in personal ..
good idea
Peter: Even I bought two condos offshore and would be interested in the
tax breaks……
gary_mathes: Rob, increase land and buildings, decrease cash and increase
liabilities to the extent you financed
Eddie-WV: I actually lucked into picking up a signed copy of Weekend
Millionaire last year in Port St. Lucie, Florida Barnes and Noble…you must
have been there for a book signing. I got it right off the shelf.
DHan: yeah but they wont let us do it…
Peter: Gary…can I deduct mortgage interest….expenses etc for a
offshore rental property
Eddie-WV: Gary/Mike…thanks. Great info!
DHan: the brokers we working with thta t is
Al_Lee: DHan, I thing buyin gin yoru name and carrying insurance is the
smartest way to go until you are prepared to use commercial lending–then you
can go to an entity.
BB: Al: If you do not lie I believe there is one last shelter avail.
gary_mathes: Peter, minority interest are woreth less that a controlling
inteerest therefore if you make a goft you can discount it
DHan: we got about 100 units now al….i think we are ready to go
gary_mathes: BB, offshore tax havens really don’t exist. You can use
offshore entities for asset protection
Al_Lee: BB: what is that?
Mike_Summey: Hi Mark, where you been?
gary_mathes: Peter, yes
BB: Al: can’t he buy in his name and transfer title to his llc?
MarkCT: I have a 5 minute break from the kids.
Eddie-WV: Mike, who do you send your montly report to in the bank, the
loan officer you deal with?
Peter: Gary so doest that mean I cannot deduct morgage interest for
offshore properties
Al_Lee: BB: that violates the "due on sale" clause of every
standard mortgage I have ever seen
MarkCT: Hi Al. Long time no speak.
Mike_Summey: Eddie, yes to the person that handles my account. I have
several banks, so each one gets a copy.
Al_Lee: Hem Mark. How is it going?
gary_mathes: No you can deduct interest for offshore properties as long
as they are rentals and you report the rent
ritchie: Peter, in my area I don’t think there is different tax treatment
for primary residence vs. rentals. That is why I did not hear about that form
Peter: So the laws are exactly same as the one if the property is located
in United States
ritchie: my tax CPA did not advise me of anything like that, and I did
ask
Mike_Summey: ritchie, where are you?
Eddie-WV: Mike, do you only deal with banks or will you also deal with
mortgage companies?
BB: Al: Do you know of any bank that will call it if you keep paying the
mort. payment?
ritchie: Mike, Cary, NC, (near Raleigh)
MarkCT: Going OK. I finally had to get rid of Regent. I gave them a
second chance but it did not work out. Looks like you have some nice properties
listed on your site.
Peter: Ritchie good to hear that….I think Al was mentioning abt Texas
gary_mathes: Peter, let me back up the interest could also qualify as
second home interest, failed to mention that
Mike_Summey: ritchie, there is a difference in tax treatment between your
personal residence and rental properties.
Brian-ON: Gary, if you can deal with international portfolio’s (small)
would you be willing to take on a Canadian account with some FL holdings etc
(tax wize)?
Peter: Gary I would be mostly renting them out there!!
Peter: so they may not qualify for second home
Al_Lee: BB: any bank will call it if you got a loan at 6% and prevailing
rates go up to 9% and they coudl use the money better than it is being used
loaning it to you. Banks and other lenders do conduct audits of their loans to
look for shananigans liek that and the do call loans–when it is convenient for
them to do so
ritchie: Mike: that’s interesting, I will have to investigate. Do you
know where to find more info?
molamoladiver: Ritchie: do you participate in the REI clubs? I’m in
Raleigh and would like to get hooked in.
gary_mathes: Brian, certainly, I have a couple of canadian client that
have interest in the US
ritchie: Now I’m wondering if I’ve overpaid?
Peter: AL and BB help me understand why the bank will call that loan
Mike_Summey: ritchie, ask Gary while you’ve got him here.
DHan: because they can rent the money out more expensively
gary_mathes: Peter, your rentals there would be treated the same as if
they were in the US. US taxpayers are taxed on worldwide incoem
ritchie: I am not a member but am considering going to the treia
(Triangle Real Estate Investor Association)
Al_Lee: Peter, because they are getting 6% from you and they coudl loan
that money to someone else and get 9%
ritchie: www.treia.com
Peter: Great thansk Gary that is very helpful
molamoladiver: thanks for the link
molamoladiver: I’ve heard of them before but had not made a connection
yet.
DHan: i live in burlington, NC
ritchie: Gary, do you know, in Raleigh, NC, what the differences in tax
treatement are for Rental vs. owner occupied?
Mike_Summey: ritchie, that is a good group. I’ve spoken there before and
they want me back again early next year.
ritchie: Mike, I’d love to meet you in person
Peter: Al…is that a sufficient reason…so our 30 yr fixed loans can be
called by the bank
Peter: Ritchie what is that group abt
Eddie-WV: Mike, I have an opportunity to do some "buy sell
speculating" in a very hot development in Florida. It’s pre-construction
stuff. My wife’s cousin has invested in 2 separate homes and made $85K on the
first deal and then $100K on the second deal. Each sold within one week of
closing. I would be able to get in with NO money DOWN…thoughts?
ritchie: real estate investors
ritchie: check the website for details
gary_mathes: ritchie, rentals would be afforded the normal rental
deductions. Owner occupied (assuming personal residence), you would only get you
interest and property taxes
Rob_L: Gary, my wife has done all taxes herself. She wanted to know what
tax forms we need to file for our rental property at the end of the year.
Al_Lee: The huge advantage that a fixed-rate loan gives you is protectin
against rate increases for the next 30 years. That is really big! You cancel
that protectin out if you violate the terms of the loan by transferring the
property without written permission from the lender. Not the broker, the actual
lender.
Mike_Summey: ritchie, once the next seminar is scheduled, we’ll post it
on the calendar of this website. Just keep checking. My next seminar will be in
Asheville November 19th. It will be sponsored by creia.
Brian-ON: Gary, please send me yor email address
ritchie: Gary, yes, I’ve saved receipts and deducted as much as I can.
Someone suggested you had to fill out a special form. i think that is other
states. My CPA did not advise of such form
gary_mathes: Rob L, probably schedule E, and form 4562 for depreciation
Ralph_Roberts: dance REQUIRED DISCLAIMER: To ensure compliance with
requirements imposed by the IRS, we inform you that any tax advice contained in
this communication (including attachments) is not intended or written to be
used, and cannot be used, for the purpose of avoiding penalties under the
Internal Revenue Code. dance
gary_mathes: Brian, gmathes@dixon-hughes.com
ritchie: hmm. I need a good reason to go back to Asheville
Mike_Summey: Eddie, that’s not my cup of tea, but if you feel comfortable
with it, do it. Just understand that it’s sort of like shooting
craps…sometimes you win…sometimes you lose.
Brian-ON: Cheers..and Good Night Gary!/ Mike!
Eddie-WV: Understood.
gary_mathes: ritchie, I’m not aware of any special forms opther than the
rental schedules
Peter: Mike we need to learn about Bookeeping too
Peter: I am having problems getting start on that
Mike_Summey: Goodnight Brain
Eddie-WV: Mike, are the details of your seminar on Nov. 19th on the
website now?
molamoladiver: I agree with Peter, that would be a good topic!
Mike_Summey: Gary, would you explain how I keep my property records and
how it helps you in preparing my tax returns?
Mike_Summey: Eddie, not yet. Will be soon.
DHan: yes please be in depth about that
BB: Peter: I disagree with Al on that. It is a technical viol. of a
banking reg. but banks have no interest in calling those types of loans. Got
that straight from 3 major banks. there is a risk they could so you have to be
aware and take that risk… Greater risk of getting sued with a coverage defense
or not enough insurance. You can get written permission from your friendly bank
but that depends.Better to ask permission than beg for forgiveness.
Mike_Summey: Hi Mark
DHan: talk about bookkeeping for like, a while
MarkNC: Hey,did I miss anything?
Peter: BB good to know that…so bottomline better get upfront permission
then beg later
gary_mathes: Mike, for everyone, Mike keeps a files for each property
with a monthly and year to date income summary on top and specific receipts for
expenses for each month. Makes it easy if an audit comes up.
Mike_Summey: It seems that several of you are interested in my bookeeping
methods.
Peter: Yes….Mike is there any course you recommend for that
Peter: Should I be using quickbooks for entering the expenses
Al_Lee: Peter, I have always saidn that if you get writtenpermission
fromthe lender, go ahead and do it. The prolem is that no lender that does
Fannie Mae or Freddie Mac, ro fha, or VA loans will give that permission. You
will only get such permission form a small portfolio lender who is not likely to
give very good rates or terms on loans.
Mike_Summey: Peter, Mike Summey’s real estate investing bookeeping
course. Sorry, but it doesn’t exist…not yet.
Eddie-WV: Mike, is there software you use for this or just something in
like and excel spreadsheet?
BB: Mike:I assume you get the expense and income data from your prop.
managers.
Bruce: Al, it is my understanding that if you put your property into a
land trust you don’t violate the due on sale clause. The Garn-St. Germain Acot
of 1982 allows a homeowner to place their property into a trust for the purposes
of asset protection and estate planning. What are your thoughts?
Peter: So that basically means you cannot get permission since most of
the loans are fannie mae for freddi mac
Al_Lee: Bruce, you are over my head on that one. I know very little about
trusts. I let my estate planner/attorney deal with that.
BB: Bruce: that is the exception.
ritchie: I am not Mike, but one suggestion for the do it yourselfer: when
you are at the hardware store, etc, and you buy something for a rental, write
the address of the property on the receipt when you are at the store
Peter: I wonder how Mike and others get permission
Mike_Summey: Eddie, I use a combination of Quicken Home and Business and
Excel. It’s something I created and it works well for me and I guess for Gary
and the banks also. My banks use me as an example of how investors should handle
their financial affairs.
ritchie: then it is easy to separate it from other receipts
ritchie: Make a folder or envelope for each property
Peter: Mike do you have some write up that explains in details how you
handle your financial matters
Bruce: BB, that was my understanding as well.
DHan: cant you put property in a land trust and make the beneficiary an
LLC you ownj?
Eddie-WV: Good. I use MS Money and I’m sure I could create something on
Excel. Thanks!
gary_mathes: Mike, Eddie, quicken or quickbooks work great and it is a
fairly inexpensive piece of software
Peter: Gary would you recommend using Quickbooks or Quicken home business
(or doesnt matter)
BB: Peter: Check with smaller local banks. We seem to get good rates.
Bruce: DHan, my understanding is yes.
Eddie-WV: Gary, do you like MS Money?
gary_mathes: I prefer quickbooks, but that is the bean counter coming out
in me. Quicken home version is probably just as good
DHan: does anyone have any experience with Tenant Pro?
BB: Ritchie: Easier to use a bus. credit card.
Mike_Summey: Peter, one thing I do is to set up a file folder with a
prong fastner in it for each property. Every invoice, check copy and any other
item relating to that property are punched and put in the file. That creates a
file of everything you need and does so in chronoligical order.
gary_mathes: Eddie, I have never used MS Money but I think it operates
similar to quicken
Peter: Has anyone used other software such the one by carleton sheets
ritchie: BB, good point. But what if I buy a bag of fertilizer, and I use
half at my house and half at the rental?
BB: DHan: Yes, you can.
Eddie-WV: Mike, would it be possible for you to send me a blank copy of
your excel sheet…as a guide for me?
Peter: Great Mike I will setup one file for myself
DHan: ritchie, thats illegalk :)~~
ritchie: What I’ve done, is write on the receipt, 50% for xxx property
ritchie: Gary, is what dhan just said true?
Mike_Summey: Gary, I agree with you that Quickbooks is better especially
if you have someone else doing your accounting. It provides a better audit
trail. If you do it yourself I think the Home and Business version of Quicken is
just a good and its easier to use.
Bruce: ritchie, you probably don’t want to co-mingle.
BB: Ritch: reimburse yourself or vice versa for the half.
Mike_Summey: Eddie, email the request to me at
mike@weekendmillionaire.com
Eddie-WV: Will do!
Al_Lee: ritchie, as a good citizen, you wouel never exaggerate your
expenmses to the irs, so you would certainly allocate 50% of the cost of the
fertilizer to business and the rest to personal use, wouldn’t you. I don;t think
may people get into real estate investing so they can write off their own
personal home expenses, do you?
Peter: Mike I would also like to get a copy of your excel spreadsheet
gary_mathes: Ritchie, I missed what he said let me try to find it. I
sthat the half bag of fertilizer? It’s only illegal if you try to deduction 100%
as rental
BB: Ritch: Bruce is right but once in awile like that you are prob. OK as
long as you quickly as poss.
Mike_Summey: Hi matthew
matthewmartinez: hello
BB: Whoops. Reimburse.
Mike_Summey: Peter email the request
DHan: lol al
ritchie: Al, I’ve been totally fair to the IRS with what I’ve reported.
Peter: Sure I will thanks Mike
ritchie: But I do fertilize both properties at the same time and save
money buying in bulk. This is a minor detail, but I claim what is fair and
nothing more.
DHan: i think he was bein sarcastic ritchie….it doesnt come across well
in internets
ritchie: ah
Al_Lee: I have heard storeis about owners who have had their hosues
painted free by the guy who paits their rent houses, but that probably does not
happen often.
DHan: thats a great idea Al!
Mike_Summey: Hi Dwayne, where have you been?
DHan: teehee
Mike_Summey: Dwayne is our expert banker.
Dwayne_Wiseman: Taking care of the little one.
Peter: Yes esp if you get twenty rental houses painted I would expect my
personal to be paited free (buy 20 get 1 free)
Al_Lee: DHan: Remember, you didn’t hear it from me ! 
Peter: Welcome Dwayne
DHan: i have one word for you: collusion
Ralph_Roberts: that time again: dance REQUIRED DISCLAIMER: To ensure
compliance with requirements imposed by the IRS, we inform you that any tax
advice contained in this communication (including attachments) is not intended
or written to be used, and cannot be used, for the purpose of avoiding penalties
under the Internal Revenue Code.
Mike_Summey: Gary, are you having fun yet? You’re typing has improved a
lot from the beginning.
Andhe: are you big time investors looking more for high appreciation, or
postitive cash flow .. like Rich Dad poor dad?
gary_mathes: Mike, the typing is terrible and getting worse.
Al_Lee: Peter, if you buy 20 and get one free your business shoudl issue
a 1099 to you for 5% of the total amount paid and you shoudl pay income tax on
it.
DHan: i totally agree Al
Bruce: Dwayne, RE: a defeance on an existing loan, any way to assume the
loan and write down the defeance aspect of the loan?
Mike_Summey: Andhe, I am only interested in cash flow. I don’t care if
the property never appreciates as long as the rents go up.
Al_Lee: Cash (flow) is King!
Peter: Andhe yes both
BB: Gary: Are there any tax liabilities after 591/2 if you use self dir.
roth to buy sell invest. properties?
DHan: i like peter
DHan: oops, that sounds weird
Andhe: i am NO longer investing with Dhan!
Peter: BB in Roth IRA qualified earnings are not taxes
DHan: Mike, can i put a link to your website on me and Andy’s?
Peter: Andhe why?
Al_Lee: I am going to disinfec the keyboard and screen after this
Rob_L: Gary, one other question about tax forms…for my own income from
the property, would I file schedule C along with my 1040?
Peter: after 591/2 distribution is qualified so not taxed
Mike_Summey: DHan, sure! Go ahead.
DHan: kewl, did you get my thank you note?
Andhe: i put 40k in per month .. my investor friend could be looking more
for appreciation ..not just cash flow.. and want opinions
gary_mathes: BB, once you have properties in an IRA you have the same tax
implications as any other investment in the ira. Good luck finding a custodian
to handle it. The ones that will deal with real estate are few and far between,
but they are out there
Mike_Summey: I did! That was nice of you.
ritchie: Gary, re: custodians. Why is that?
Dwayne_Wiseman: Bruce I am not sure. Sorry.
Mike_Summey: Just looking at the list of people in the chat, I missed
some of you when you entered, so welcome everyone I didn’t personally greet.
Bruce: Ralph, How do I cut and copy text written above?
Peter: Self directed IRA require a custodian (such as a Roth IRA trading
account you have with a bank or broker)
gary_mathes: ritchie, my personal feeling is that it is harder for them
to collect their fees and annual valuation is more difficult
Mike_Summey: Bruce, it will all be posted on the website within minutes
of the chat’s conclusion.
Al_Lee: Mike, Folks: I need to run now. I have enjoyed the banter and the
serious discussions. Hope to be here next week, too. So long for now, Al
BB: Gary: Are you saying that I cannot take my gains out 100% tax free
from a Roth after 591/2 from a RE deal I bought and sold in the Roth??
Mike_Summey: Goodnight Al
Ralph_Roberts: Bruce, you can click on the two little pieces of note
paper icon and cut and paste from the resulting screen… or get it out of the
transcript when I post it
DHan: seeyal al
Bruce: Hi Dwayne, thanks anyway.
DHan: ou later
Bruce: Ralph, thanks, that’s what I was looking for.
gary_mathes: BB, no I am saying that the investment with in the IRA is
treated as any other inverstment and the tax implication of the post 591/2
withdrawal are the same.
Mike_Summey: Gary, before everyone leaves, I want to say thanks for your
participation tonight. We’ve had a lot of good questions and dialog and that’s
what these chats are here for.
Bruce: Gary, thanks, great info.
molamoladiver: Yes, thank you both very much, my head is swimming with
ideas.
gary_mathes: Mike, I appreciate the opportunity, if anyone has follow up
questions I posted my e-mail address earlier
ritchie: Thanks Gary, thanks Mike
DHan: Thanks Gary! Thanks Mike! Seeya Everybuddy!
Eddie-WV: Mike/Gary…thank you!!!
Mike_Summey: If everyone begs him, Gary may become a regular with us,
like Dwayne has been.
Ralph_Roberts: and thanks to the dancing elephants for disclaimer duty
dance
Ralph_Roberts: REQUIRED DISCLAIMER: To ensure compliance with
requirements imposed by the IRS, we inform you that any tax advice contained in
this communication (including attachments) is not intended or written to be
used, and cannot be used, for the purpose of avoiding penalties under the
Internal Revenue Code.
Peter: Gary…I would appreciate if you join us in our weekly chat
sessions …it is fun out here
gary_mathes: Mike, I would be happy to come back maybe next time I can
keep up a little better
Mike_Summey: Gary, I hope you have enjoyed the experience and you are
welcome anytime you can join us. These chats are held almost every Monday night.
Ralph_Roberts: the elephants might want a raise
Rob_L: Gary, we would love for you to practice your typing skills with us
Peter: Mike if Gary joins the mailing list…he will get mails whenever
there is chat
Bruce: Gary, again, thanks,
gary_mathes: Ralph, hold on to that disclaimer
Peter: Thanks Gary and Mike
Mike_Summey: Peter, he has already joined. I would let him come tonight
unless he did.
Ralph_Roberts: heh, heh… yep, it’s programmed into the chat, Gary
Peter: okay great
Kim-OH: Gary, thanks so much for your participation and please do join us
again
Bruce: by all
Mike_Summey: Gary, Ralph has it scheduled to appear regularly when you
are involved.
Mike_Summey: We’ve gone over about 30 minutes tonight, but it seems like
the time has flown by. I hope everyone got the information they were looking for
and we all need to thank Gary for his time.
Mike_Summey: Goodnight all!
Eddie-WV: Goodnight Mike/Gary!
Kim-OH: mike time flies when the conversation is good
molamoladiver: thank you and good night!
Ralph_Roberts: good night … transcipt up shortly
Kim-OH: Night Mike and Thanks again
Ralph_Roberts: REQUIRED DISCLAIMER: To ensure compliance with
requirements imposed by the IRS, we inform you that any tax advice contained in
this communication (including attachments) is not intended or written to be
used, and cannot be used, for the purpose of avoiding penalties under the
Internal Revenue Code.
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