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Maybe if "more people" includes the same people buying more houses. More people getting outbid for one house is kind of the opposite.
Basket of goods makes inflation malleable. So 2018/2019 it got a mallet. Then Treasury and the Fed could've propped up long rates by buying long term/selling short term in 2020 and reduced the RE bubble, inflation, and the illiquidity of golden handcuffs. But POTUS was combover deep in RE debt and needed to refi. So.
The fact that low rates are generally advantageous for the middle class vs not being able to get a loan does not change my belief that abnormally low interest rates largely increase wealth inequality.Quote:
Originally Posted by Mustonen
The person who is able to buy their first home because of a low interest loan is still losing ground vs the person who can get the same rate to buy a second or third property or play some other lucrative investment.
To me, there is a big difference between an economy allowing low rate loans to buy a primary house/car or start a small business vs allowing the same rates for extremely rich or large companies to play derivatives and purchase investments. Additionally, because these players have the ability and means to create tax sheltering, the inequality is amplified. That's true even if your average joe can now buy the house and car they deem necessary for a nice life.
Yeah…. I don’t see the low rate environment tipping the scales toward the wealthy such that it plays a big role in driving wealth inequality. High rates benefit those who have money. Low rates benefit those who don’t. Allowing individuals to leverage is a thing, but that’s risky and is as likely to trim the bold as it is to create new winners.
Maybe another data point: I follow a number of progressive/left-leaning economist (as well as some center-right, and some libertarian leaning), and have been doing it for going on fifteen years now.
In that time I’ve seen the left leaning economists advocate for all sorts of measures to reduce inequality and help the less fortunate. Not once have I seen one suggest that higher rates would be a way to do it. And of the ones who have said anything about current Fed rates, they’re all concerned that the Fed is waiting too long to start cutting.
If you do not already, pony up for a decent CPA to take a look at your finances and taxes. Yes, it'll cost you some cash but unless you're in prison, you should come out net positive and be better positioned in the future. I used to do this every few years in my late twenties/early 30's and I was always glad I did. Now my wife and I use a CFP and a tax accountant but that's mainly because I'm not particularly financially literate and I'm also lazy. But it's still definitely net positive.
To the peeps up thread, try not to think about how many times you're being taxed on every dollar. It might make you a Republican.
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I've been using a CPA for a few years now although our taxes are reasonably straight forward. There's a big gap in my understanding of when and why to bring in a tax accountant. Sure, complexity of your tax situations matters. Same with the amount of money involved. But what are the finer points?Quote:
Originally Posted by The Reverend Floater
Not just for taxes but also large financial decisions. Easier to pay less tax by structuring decisions advantageously in regards to tax code. That's when CPAs can help with the finer points.
Your accountant charges you $420 a month to keep the books on a business that does well into 7 figures of revenue? Isn’t that like what you charge for a light bulb? Maybe you just found someone good and cheap, or maybe your money man is scamming from you. Aren’t you doing the exact thing you accuse clients of doing, wanting to pay bargains basement prices and get a good work product.Quote:
Originally Posted by fastfred
Maybe 420 is code for an unmentionable amount of weed in some sort of barter system.
I'm hardly qualified to answer but it definitely became more positive once I had a side revenue stream, an LLC, a property to maintain and then, of course, kids. That is to say, the more complicated your 'books' are, the more a good CPA can likely serve you.Quote:
Originally Posted by huckbucket
The other thing I've always appreciated was the willingness to not only do, but also teach. I am fortunate in that even in my younger, low income days, my then CPA was willing to explain the "why" behind everything he did. This was super valuable and helped me to make better decisions as it pertained to my assets and liabilities--even when they were not much more than a mortgage, an old, beat up truck and credit card.
I tell my wife I'd like to mandate that our daughters at least minor in finance. For better or (likely) worse, it really does make the world go round and there's no way they wouldn't benefit from it. I wish finance was more than just a few classes on the way to my undergrad degree.
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Thanks. To make matters worse, my financial advisor (not CPA or attorney) helps me to position my investments and purchases relative to tax liability too. I suppose the "when" guidance is to weight the savings against the cost of the service. But the "who" question is driven by matching the complexity of the situation to the expert.Quote:
Originally Posted by Conundrum
Lol my shit is tightQuote:
Originally Posted by neufox47
Phoning in million dollar remodels from hilton head this morning
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Don't need the title to know tax code. If your FA is good, good. Would be worth asking them if getting a CPA or attorney on board your team is worth it. Easy intro to a legal firm is to have them write your will. It costs more than pulling a form off the internet but then you have an intro to the firm and they know you when you might need them. Most firms that do estate planning have real estate expertise there too. These are not people you need to retain or use more than once a year for taxes (CPA) but the upfront cost is worth the relationship you gain when you really do need some tax or legal advice. Finding someone new in a rush is harder than dialing someone you know from the contacts in your cell phone.Quote:
Originally Posted by huckbucket
I toured a chartered accountant around HBM for a buddy, numbers guy bought me lunchnabeer told me to take the CPP early at age 60 on one of the chair rides
2 1/2 hrs to do my taxes with free online service from IRS.gov
1040 SR I've intentionally structured my finances so I need 5 documents to do my taxes in my retirement years
that may change slightly when I hit mandatory withdrawals but I have a few years before then
Mother fucking 1099s. 25% of my clients now send me their 1099s via different services. Everyone fucking one requires that I set up an account with a PW and furnish different information including my e-mail and phone number so the bastards can spam me.
Anyone here used active STR losses to offset W2 income? Seems like it exponentially increases your chances of getting audited. Frankly it seems like a bullshit loophole, but the allure is intriguing.
For anyone curious the summary is you use cost segregation studies and bonus depreciation to rapidly depreciate a property, the depreciation drives a significant net loss of income and you use that against W2 wages.
I know there are some key factors like you need to document 500+ hours of time spent actively managing them and you cant use / stay in the rental more than 14 days a year or 10% of the amount of rental days.
Wondering if it is worth the trouble / commitment.
Financially probably worth trying. Not sure what to tell you about your soul.
That's pretty rude.Quote:
Originally Posted by Bunion 2020
It was the flip side of that with our accountant. Every year he used different software, sometimes two different programs only one of which he actually used to do the taxes and he didn't say which one, and the last year his program didn't work at all so I fired him and used TurboTax.
Have you considered a "honey-pot" email address and a Google Number?Quote:
Originally Posted by Bunion 2020
Quote:
Originally Posted by neufox47
If it's legit I'd do it to save $1000 but not for $100. And don't spend the savings so you have it to give back if an audit goes against you. One caution. I wouldn't have done it when I was self employed as I was playing other tax games to stick it to the man. Pigs get slaughtered.
One of the dumbest things I ever did was a 1031 exchange--we sold the house my wife had before we got married and put the proceeds into our house in Truckee, which we then had to treat as a full rental for 18 months I think. The fees for the exchange were more than we saved on the minimal profit my wife made on the house and we couldn't use the house until the 18 months were up.
That wasn't as dumb as my partner/boss in Sacramento investing in a cattle tax shelter. The IRS disallowed the shelter and he wound up owing them a bunch, plus the guy sold the same cattle to a lot of different people so he lost the investment too. I told him you shouldn't invest in cattle unless you can rope them and throw your brand on them.
And broil and eat them. With garlic, salt & pepper mix.
I've heard you can boil them.Quote:
Originally Posted by Bunion 2020
I have seen so many stupid decisions made in the context of 1031 exchanges just to defer a few thousand dollars in taxes. Baffling.Quote:
Originally Posted by old goat
On the flip side a 1031 was one of the smartest things I’ve ever done. Saved soooooo much money. Context matters, right?
Old goat - mine was also in Truckee but this was 2016 so it didn’t have to be a full time rental (laws have probably changed in recent years). STR for 2 years for a minimum of X nights, which was a pain, but all clear after that and no more Airbnb nonsense. Saved 6 figures.
Yeah, it makes sense to save 6 figures. The Tucson market when my wife sold was in the toilet, we were looking at more like 6 dollars. We were naive and this was before information about stuff like that was easily available on the internet. We got bad advixe from real estate people.Quote:
Originally Posted by TahoeJ
The principle is still widely applicable--a lot of people lose money trying to avoid taxes.
Anyone with a rental property switch from a tax preparer to TurboTax? I used TurboTax for years and switched to an accountant when we purchased a rental property and I didn't know much about depreciation. I'm thinking about switching back as our accountant sucks (timeliness and mistakes) and it takes just as much time to fill out their questionaire as to enter it in TurboTax myself.
My main concern is depreciation. Will TT let me manually update the depreciation schedule? Any pitfalls to be aware of?
Pretty sure it did, might have had to purchase the higher level. Also think it kept track when I sold rental for tax on depreciation.
When my wife first started as a contracted employee (medical transcription), I used a tax accountant and prepared with TurboTax at the same time. When I compared, I had missed one deduction. I used TurboTax after that.
It was a very easy return, so keep that in mind with the comparison.
Not sure if anyone know the answer to this, in regard to depreciation of a Rental Property also used for personal use. Schedule E Line 2 asks for the "Fair Rental Days". Is this the number of Days RENTED or number of Days AVAILABLE to Rent?
Context: My Tax Preparer made a mistake with depreciation on our 2022 taxes. For prior years they used Days Available and for 2022 used Days Rented. This resulted in a big difference in the amount depreciated. They are planning to update 2022 using Days Available. However, in researching this I think it should be based on Days RENTED and that they need to correct the years prior to 2022. IRS Schedule E instructions seem to indicate days Rented:
Attachment 486734
This came up because I am moving on from the Tax Preparer and hoping to go to TurboTax. I posted in the TT forum to see if it could handle a correction to 2022 depreciation. As I provided more details, they indicated I had been claiming too much in deprecation and that my accountant should have used Days Rented. My accountant insists its Days Available. As much as I don't want to, I may need to use a different accountant this year. Anyone know who is correct? :D
Number of days rented/number of days occupied for mixed use property, assuming you occupied it for more than 14 days or 10% of rental days. (rules are different if personal use was less)
that formula is applicable to all expenses. You aren't able to assume rental activity when its vacant unless its a full time rental.
Does that apply to depreciation as well. Depreciation is where the error is.Quote:
Originally Posted by Master of Energy
the formula is applicable to all expenses.Quote:
Originally Posted by slcdawg
Since depreciation is an expense, then yes.
Thank you. That is in agreement with what I am finding online. My accountant is insistent that its the other way around. :mad: Pretty frustrating.Quote:
Originally Posted by Master of Energy
We used to have an accountant who was very aggressive with depreciation, mileage, etc. We were having dinner with friends and the guy said they owed the IRS 100K. Turns out they had the same accountant. We switched.
I agree with Master of Energy. You should not rely on this agreement and should seek the advice of a qualified tax professional.Quote:
Originally Posted by slcdawg
You should get your accountants opinion in writing on this if possible…
Depreciation is an expense that reduces basis. More cap gain later. Less ordinary income now.Quote:
Originally Posted by slcdawg
Filing an amended return could be a flag. Depends on how much of a difference it makes. I would let it slide.
Switching to TT. Your return should have a depreciation schedule. Before you fire your accountant get a copy. Keep using that.
We are above the income threshold, cannot take a rental loss - and are not benefitting from the depreciation. How much does it really matter if its incorrect? It looks to be off by a factor of 6:1.Quote:
Originally Posted by Core Shot
I'm reluctantly realizing I need to find a new acct to review the prior returns.
Working on 2023 taxes and trying to figure out why we are owing so much. No major changes for my job. Good amount of INT income as expected, but was already very much negative prior to entering that income. Wife started a new job end of 2022, that was less total income for 2023. Only thing I can figure is she had to use the new W-4 form when starting new job and that isn't withholding the correct amount. Anyone else seen issues with new w-4?