Errrrr ! I hate tax time. Need help with a couple of issues. - Posted by breeves

Posted by Jim IL on February 07, 2000 at 15:22:34:

Tr talking to other REI’s in your area and ask them to refer you to a good CPA.
Someone out there is doing taxes for investors, and doing it right.
Ask around, and you may find a good one to build a relationship with.
Never hurts to ask, right?

Good luck,
Jim IL

Errrrr ! I hate tax time. Need help with a couple of issues. - Posted by breeves

Posted by breeves on February 07, 2000 at 07:13:58:

I have a rental property and operate as myself. No corp, LLC, etc. So I understand this businees goes on Sch. C. I also bought, fixed up and sold a house. Where do I report this info? As a sale of a buisness asset? Is it incorporated into the Sch C?

Ok, one more if you will. I did a L/O, but it acutally turned into a straight sale from the original owner to the new owner. I got a letter signed from the original owner instructing the title co to distribute funds at closing per our agreement. So I pocketed about 8k but my name is on no paper work except for the HUD 1 on distribution of funds line. Do I get anything (1099,1098)from the title co. Is this just income as commisson on Sch C?

Did I say I hate tax time. I’m using TaxCut software which helps considerably but still need advice.


Re: Errrrr ! I hate tax time. Need help with a couple of issues. - Posted by The Baze

Posted by The Baze on February 07, 2000 at 17:01:58:

Your rental property will go on Sch E. The house that you purchasd, fixed up & sold will go on Sch D. Make sure you include the fix up costs into your basis. As far as the lease option, your rental income & expenses go on Sch E. As far as the sale goes, did you have an option price on the house? Did you do a simultaneous closing? Usually, it’s a transaction in which you purchase the house, then turn around and sell it. In that case, you need to report it on Sch D. Hope this helps.

Tom Bazley

Get yourself a good CPA - Posted by SusanL.–FL

Posted by SusanL.–FL on February 07, 2000 at 09:44:52:

My advice to you would be to get yourself a good CPA (i.e., someone knowledgeable in real estate, corporations, everything…).

It is hard to keep up with the constantly-changing tax laws. In my opinion–it would also be risky (and could be costly) too–to do your own.

My inc. tax. return last year took my preparer 26 (!!!) hours to do—and she was experienced! (It looked like the Yellow Pages when I picked it up.)

I have since scaled WAY down in my investments but would still NEVER attempt to do my own return. Personally, I feel I would just be asking for trouble.

Good luck. Hope this helps!


Re: Errrrr ! I hate tax time. Need help with a couple of issues. - Posted by phil fernandez

Posted by phil fernandez on February 07, 2000 at 08:24:19:

Your rental property goes on schedule E not schedule C.

Re: Get yourself a good CPA - Posted by Prudy

Posted by Prudy on February 07, 2000 at 12:34:33:

I would like a good CPA, but finding one seems to be a problem for me. In the last 3 years, I have changed every year after looking over my returns and finding mistakes. If I can find mistakes, we got a problem. I think one of the mistakes that is happening to me is that the CPA puts me in a computer tax program and it then come out with mistakes that would not have happened if the CPA realyy themselves did my return. So how do I find one. Thanks

I have also had my ?share? of ?doozies? for accountants and CPAs these past couple ?o years. - Posted by SusanL.–FL

Posted by SusanL.–FL on February 11, 2000 at 09:53:06:

Hi Prudy!

One that Kenny and I had used for years and years [Person: A] was ?good? but he also had a shyster side to him and he didn?t mind ?$gouging$ people.

I had opened a corporation late in ?96 (but never used it). (What we had intended to use it for, never materialized.)

When ?Person: A? was doing my ?96 taxes, he charged me $950.00 (!!!) for filling out the one or two Corporate forms for my tax return. I thought this was outrageous! First of all, he knew I was having SERIOUS financial problems that year. Secondly, I had referred a LOT of business his way over the years (not to mention the slew of letters I had sent out [on my own for him] to my renters ?n friends trying to help drum up business for for his new insurance company!) Howz that for a kick in the chops.

(We have since parted ways, and not amicably either?)

?Person: B?
After that little episode, I interviewed MANY CPA?s before I found a ?reputable? one. Palatial offices in a highrise right in the heart of $Sarasota$. Thought I had hit paydirt.

I submitted all my 1997 ?stuff? to him in December, 1998. I was running late that year (and was ?on the cuff? for a $1,000 late fee?right from the git go).

Told him that I wanted this ?return? submitted on for BEFORE the April 15 deadline—so that I could ?get back on track? again. Good luck Charlie?.

I hounded this guy for months and MONTHS to complete this return ! He kept losing papers; I kept faxing duplicates. I finally had to call the owner of the firm to get my dang tax return back. R U ready for this? It took me S-E-V-E-N months—for which I paid MORE late fees!!!

?And get this—I asked for a quote from him before he started?.They sent me a bill for DOUBLE the amount originally quoted!!! (probably storage fees for my paperwork) :slight_smile: I paid the original quote, marked ?paid in full? on my check, and sent it back to the owner with a letter. They cashed it and I never heard another word from any of them.

P.S. ?Persona B? had to ask ?Person A? for a copy of my depreciation schedule. ?Person A? refused to provide it.

?Person C? (This was the magic number! )
I asked for an approximate quote from her at the start. She completed the return in a timely fashion and had to correct several mistakes from ?Person B?s along the way.

It turned out that she put in 26 hours total on my return—far and above exceeded her original quote. In this case, I insisted on paying her for the time she had put in but she absolutely refused to take a penny more than what she had quoted me.

(I sent her a gift certificate from a store near her office afterward.)

Happy ending though. I finally found someone who knew what she was doing!