The Goal of Real Estate Investing
Your Team Makes the Difference - So Does Your Bottom Line
Having proper investment goals will have a large impact on the long term financial results of your business. One major goal to keep in mind is to make sure your real estate investments show negative or zero taxable income at the end of the year.
There are a variety of legal and legitimate ways to do this. Having a great tax attorney or accountant to help you with your goals is essential for every real estate investor.
Doing simple things during the entire year will help you prove your taxable income on your real estate is negative or zero. The most important things to start with is keeping excellent records on each individual property, tracking mileage and tracking your time.
Keeping accurate records on each property also makes tax preparations easier and less costly. You must be able to prove you qualify as a real estate investor and professional to qualify for tax benefits. In order to prove to the IRS that you qualify, you will have to prove you spend at least one half of your time in your real estate business.
You must spend at least 750 hours on real estate [http://dahmsrealestate.wordpress.com] business and show an additional 500 hours of hands on time on your rental property activities.
There are a multiple ways to save on your taxable income in relation to your investment goals. Finding and working with a reputable tax attorney and accountant who are up to date on the latest requirements by the IRS.
In the best case scenario, these professionals are real estate investors themselves and therefore familiar with the challenges of the business.
Make sure the person or company you hire has clients in all aspects of the business such as tenants, buyers, contractors, investors and suppliers. This will ensure they have a vast knowledge of all the workings of the tax laws and codes.
Additionally make sure that the accountant or tax attorney you choose adheres to GAAP, generally accepted accounting principles. These rules are used to provide consistency among the financial reporting of businesses and companies.
Having proper investment goals will have a large impact on the long term financial results of your business. One major goal to keep in mind is to make sure your real estate investments show negative or zero taxable income at the end of the year.
There are a variety of legal and legitimate ways to do this. Having a great tax attorney or accountant to help you with your goals is essential for every real estate investor.
Doing simple things during the entire year will help you prove your taxable income on your real estate is negative or zero. The most important things to start with is keeping excellent records on each individual property, tracking mileage and tracking your time.
Keeping accurate records on each property also makes tax preparations easier and less costly. You must be able to prove you qualify as a real estate investor and professional to qualify for tax benefits. In order to prove to the IRS that you qualify, you will have to prove you spend at least one half of your time in your real estate business.
You must spend at least 750 hours on real estate [http://dahmsrealestate.wordpress.com] business and show an additional 500 hours of hands on time on your rental property activities.
There are a multiple ways to save on your taxable income in relation to your investment goals. Finding and working with a reputable tax attorney and accountant who are up to date on the latest requirements by the IRS.
In the best case scenario, these professionals are real estate investors themselves and therefore familiar with the challenges of the business.
Make sure the person or company you hire has clients in all aspects of the business such as tenants, buyers, contractors, investors and suppliers. This will ensure they have a vast knowledge of all the workings of the tax laws and codes.
Additionally make sure that the accountant or tax attorney you choose adheres to GAAP, generally accepted accounting principles. These rules are used to provide consistency among the financial reporting of businesses and companies.
Source...