Tax time tips - Posted by Realstar

Posted by Randy (SD) on March 29, 2006 at 08:20:48:

I am not a tax professional, self proclaimed “tax savvy”. Without detailed research IMHO you are incorrect in your statement regarding recapture of the depreciation “if you did not claim the depreciation”. I agree there is a recapture of depreciation upon selling for a profit, so maybe you could provide us some proof to back up your statement. Assuming you are correct, most tax professionals would agree you’re better off to take the deduction this year and payback with deflationary dollars in future years. No one will give you a worse return on your tax dollars than the IRS.

Regarding the allowable “business expenses” you are dead wrong! To not claim legitimate business related expenses is ludicrous, if you feel it’s too much work I suggest you learn how to work smarter. I have been using Quicken home and business and TurboTax for approximately 10 years. Spending approximately 15 minutes a week entering transactions into Quicken (enter a utility bill or other expense, categorize it and Quicken automatically memorizes it… you’re done). Next time You go to pay that bill you type the first two or three letters of the name and Quicken recalls it. At tax time, TurboTax automatically imports all that information from Quicken completes all schedules and files your return. I typically spend about an hour and a half per year on taxes and get back SIGNIFICANTLY larger refunds than I would if I took your approach… but to each his own. H&R Block is currently running a commercial stating Americans overpaid $9 billion in taxes last year, thanks for your contribution.

FYI it’s a lot more than $100 deduction, I have an assistant and I help her in doing her taxes. She’s a wage earner making $25 K. a year from her primary job and this year she got back over $1200 vs. the $300 she would have gotten had she not claimed her home office . She doesn’t even own a home, she rents.

Tax time tips - Posted by Realstar

Posted by Realstar on March 28, 2006 at 08:38:00:

Does anyone have any Real Estate tax tips. April 15th is right around the corner.

Re: Tax time tips - Posted by Randy (SD)

Posted by Randy (SD) on March 28, 2006 at 14:04:01:

Real estate tax tips… let me see only about 10,000 of them. Keep good records, deduct everything even remotely related to your real estate business. Don’t forget if you use a portion of your home as your office or base of operation you can deduct all of the costs associated with your home office as well as a proportionate percentage of your total housing cost (for example your home is 1200 square feet, you use 300 square feet (25%) for your office that means you can deduct 25% of all of your housing costs including utilities, maintenance, repairs, lawn care, snow removal etc. etc. etc.) there is tons of information in the archives, enter “tax deductions” in the search.

Re: Tax time tips - Posted by dutch

Posted by dutch on March 28, 2006 at 17:07:58:

You know, about that home office thing…

Weight the amount of bookkeeping (and risk) involved vs. the reward.

What most people don’t tell you is that when you SELL your private residense, you have to give back that depreciable part that you expensed all those years EVEN IF YOU DIDN’T TAKE THE DEPRECIATION.

And if you use that office space for ANYTHING but work, well, there goes the deduction.

IMHO, just not worth the effort to save another $100 on your taxes.