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Find Your Real Estate Investing Tax Breaks

Real estate investing tax breaks are one of the big reasons many investors buy property. As an investor, you can write off all sorts of things that will end up reducing your taxable income, and therefore, reducing the amount that you owe.

Just to give you a feel, here are some of the things you can deduct that you’re probably already spending money on in your real estate investing activities:

Travel to go see your property (Maybe it’s even in the same city as your in-laws or your favorite beach vacation spot)
Interest on your mortgage for the property
Insurance on the property
Property Management, Accounting, Legal Fees, Accounting, and other professional advice
Training and education associated with your property
Repairs and Maintenance at the property
But remember, you can’t charge for your own time working at the property, you can only account for things that you pay someone else to do. So, the next time you’re wondering whether to pay the neighbor’s kid to mow the lawn at your rental property or do it yourself, remember, you’d be paying him with pre-tax dollars.

Don’t buy a property JUST to save money on taxes…

Tax savings can really add up! They can turn a property that puts money into your pocket every month into a tax write-off. But remember, it’s not all fun and games. You still have the responsibility of finding a good deal, managing your property, and selling it when the time is right. Don’t buy a property JUST for the tax benefits alone (a lot of people who did that got wiped out – bankrupted! – in the 1980′s when the tax law changed and their tax write-off’s went away.) Always make sure your property fundamentals are sound!

Knowing When To Sell To Maximize Tax Breaks

Knowing When To Sell To Maximize Tax Breaks Speaking of selling property, bear in mind that one of the purposes of the tax law is creating incentives for you to do certain things. The government is rewarding you (with tax breaks) for taking desired actions.

In the case of real estate investing, the government wants to reward you for holding property long term (over 1 year) as affordable rental housing in many cases – rather than having you get rich with short term fix-and-flip strategies.

If you hold the property for less than a year, the government treats your income as short-term capital gains tax, which is taxed at your ordinary income tax rate (that’s HIGHEST of your tax brackets, usually).

To get the lowest tax rates, hold the property for at least a year and your profit on the sale will be considered long-term capital gains and the tax treatment will be much better. Currently, long term capital gains tax rates are just 15%, but President Obama has suggested he will raise the tax rates to 20-25%… so stay tuned!)

If you don’t want to pay any taxes at all when you go to sell your property, consider participating in a 1031 Exchange, or Starker Exchange (same thing, different names). This is a transaction in which an intermediary helps you sell one property and then buy another similar investment property. You can roll all your profits from the sale of the first building into the purchase of the second building. If you do – you won’t pay any tax on the new building! Do your own research, but it’s worth getting more information on 1031′s if you’re selling a property with a lot of equity and want to make sure you’ll minimize your tax bill!

Real Estate Professional Status

Long term capital gains tax treatment isn’t the only real estate investing tax break in jeopardy… The Real Estate Professional status is also getting harder to qualify for. Real Estate Professional is an IRS designation which says you spend at least 750 hours a year working in real estate investing, and that real estate is your primary business. If you qualify for this designation, you have the ability to deduct ALL your losses from real estate, even if they are in excess of $25,000/year. If you don’t qualify, your real estate deductions may be limited, especially if you are a passive investor not actively involved in real estate investing, or you have an especially high income.

Another bug-a-boo in the land of real estate investing tax benefits is the AMT or Alternative Minimum Tax. This is a tax that hits high income earners if they have too many tax deductions, even if those deductions are legitimate. Congress keeps patching this, but it’s hitting – and hurting the middle class. If you earn more than about $130,000/year this may affect your family, so consult with a tax advisor to see if you’ll be able to take advantage of the real estate tax breaks you’re expecting.

More Real Estate Investing Information

Please, as you read through this article, bear in mind that I am not an accountant or tax attorney. I am another investor like you and I am just sharing from my own personal experience. Tax law is complicated and changing, so I encourage you to consult with your own team of professionals on any topics that you need more information on or strategies you plan on implementing.

Home Based Business Services – Do You Really Need A Bunch Of Stuff?

How many times have you seen the ads pop up during a web session browser, “Make money fast online” with home based business services? How many times have you visited the same type of site, only to find it was just another way to make a website, with all the same old fees involved? Or, perhaps the fee was all inclusive? All one knows, is that after doing enough research on these sites, it’s easier than ever to run your own home based business.

So, how do you start? Well, the best way is to list the services you will offer. Keep in mind that this will need to be a pretty comprehensive list, especially if you are offering multiple services. After you have a good list, post it on your website and then it’s just a matter of providing contact information so that would be clients can contact you. With all the many, many ways to create a home based business service, how can one really distinguish what’s important to such an endeavor? There are at least two things that you will need.

First, you’re going to need an auto-responder, to answer all the incoming emails for your home based business services, something along the lines to let people know that you will follow up with them at some time in the future. What is really going to be the time consuming part, is actually going through each email and adding that personal touch to it by answering that “soon to be” client. This way, you can generate your own leads, without having to pay someone else to find your new clients. This will cost about $20.00 a month, but it’s worth every penny. You’ll have a readymade list of clients that have been answered by your auto-responder. This also will enable you to answer each person individually, at your own leisure. This allows you to start a rapport with a client that ultimately will decipher whether or not you wish to work with that person.

There will also be a need for a custom domain name, so that people can visit your web link, which will cost about $10.00 a year. After all, how will people find out about your services, if they can’t visit a link that lists the services you offer? There might be other fees that you will find along the way that are included as a business expense. However, a domain name fee, and an auto-responder are two fees that are essential to a home based business. Of course, all of it is useless without a computer, which you already have or you wouldn’t be reading this.

Once you have your home based business services set up, the next step is to get to work. Don’t go out there and buy leads, generate your own. When you generate your own leads, you’re positioning yourself as the expert, rather than someone else. At that point it becomes about your relationship with your audience AKA your potential customers.

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How To Succeed At Online Product Creation The Easy Way

Product creation could be a frightening subject for a lot of Internet marketers to face. Some folks who get in the game with the intention of making a full time income are completely ignorant as to how an online business operates. One of the most profitable ways to create online cash is by creating a product that others are happy to pay for.

Product creation is legitimate method of generating money through internet marketing but many entrepreneurs get it wrong. They start by imitating their Internet marketing gurus by creating information products on Internet marketing in hopes of getting rich the way their heroes did. The problem is that they usually don’t know what they are doing and enter a highly competitive niche with very little marketing experience or connections.

Here are a few tips for effective product creation that may help you get on the right track:
Start by finding a profitable niche with low to moderate competition. If you conduct some rudimentary market research and keyword research, you’ll find many opportunities in areas that will surprise you. Amazon and eBay are two great places to brainstorm for product ideas.

Developing Your Product does not have to be a difficult project. You can find experts in the right field for your niche and pay them to write the material while an artist designs the packaging and website or blog. You can outsource the entire product creation part of the project after you conduct the research and testing to ensure profitability.

Sales and marketing strategies should be created while developing the product and learning about the market. Some experienced marketers use pay per click to drive traffic to their offer page; some folks outsource the entire marketing campaign to affiliates through ClickBank or other affiliate programs.

Product creation does not need to be hard, particularly when the merchandise is electronic. E-books, videos, audio and multi-media products sell very well. They are distributed immediately to customers electronically. Once you have a good feel for a niche market, try to service your customers with associated products and upgrades. If you want to earn money online through product creation, you must understand supply and demand. The majority of new online marketers fail miserably because they go after highly competitive markets or forget to research their chosen niche properly. You have to create your products according to the needs, wants and desires of the prospective customers.

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