Hello Harbajan, when it comes to your personal residence there is no write offs from income taxes unless you are claiming a portion of your home as a business use, office space, storage of goods etc... Please confirm with your accountant how much you can write off but in general only rental income properties are subject to the write off you mentioned. If you or any reader would like to discuss this further please do not hesitate to contact me at any time. Abraham Niyazi - Mortgage Agent - Lic# M08010640 - Centum One Financial Lic# 10758 - Cell: 416-993-4082 - Office: 1-866-RATE-708 http://www.centum.ca/abraham_niyazi/ I have access to 25 Banks/Lenders across Canada and 11 years experience in the industry.

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I mean, how much you have to pay tax for it and how much of it you can deduct for tax (like condo fee, property tax,...) and what happens when you sell the condo after? you have to pay extra tax again since you made money out of it?

No one can answer that for you. You have to do a complete analysis to answer the question. What is the cost of your mortgage payments, taxes, and maintenance? How is the rental market in your area? How much can you realistically get for rent? Will the rent cover your costs and still give you a reasonable profit? How long can you hold out if your renter leaves and you have difficulty finding another one? Do you want the hassle of being a landlord and having to do the maintenance when things go wrong? If you can realistically make enough money to cover your costs, including the time that it will be empty between renters, then it may be a good idea. If you can't, then it's not a good idea. Association fees are not tax deductible, so don't count on that as a break. Yes, you will have taxable income but you might also be able to deduct depreciation, so that could offset some or all of the extra tax. You will also have capital gains tax when you sell if you make a profit on the property and you don't meet the IRS requirement for having personally lived in the home for the required time.

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...or would i have made more money investing the same $215,000 in stocks and bonds, etc.? i know this is an over-simplication but i’d like to hear from some people, especially real estate investors, about whether or not they think i’ve made money on the condo i purchased in pa in july, 2004. so figure i’ve owned it for 7 years. --i purchased it for $215,000 and paid cash for it at my husband’s insistence. this was against my real estate agent’s advice (tom) because tom felt i should take out the maximum loan i could so i could invest in additional properties in order to make serious money. [in hindsight, given the housing crash, i’m glad my husband put on the brakes but that’s beside the point here]. so i paid $215,000 cash, which means i am not getting any tax breaks on any loan i took out. --closing costs were approx. $6,000. advertising costs for a tenant in the beginning were over $2000 and i lost 2 months in rental. [because the market unexpectedly changed—there were suddenly not enough renters. turns out it was cheaper to buy than to rent]. --rent i’ve earned since 2004 has been $1350/month (subtract out 2 additional months rent between tenants). for the last 3 months, after replacing carpets, rent has been $1450/month. --maintenance expenses (new heat pump, carpets, paint, landscaping) have been about $12,000 over the years, although tax deductible (td) --yearly heat pump maintenance--$190/year (td). --every-2-year-chimney sweep inspection--$140, or $70/year (td) --condo fees: average $160/month (td) --water and sewage (which i the landlady pay for) have been approx. $500/year (td). tenant pays for electricity, which includes heating. --cost of getting a new tenant (i no longer advertise myself, i always use a real estate agent now) has been 3 x 1350, or about $4000.00 (td). --taxes have been approx. $2400/year (td). --insurance for interior (most of exterior is insured by condo fees)? i’m not sure—our usaa agent attached it to our own homeowner’s insurance. i think it’s about $200/year. actually, i don’t know if our accountant has earmarked this amount as tax deductible or not. --comparable units have sold in the last 2 years for about $235,000. my husband has always felt that it would have been wiser to invest the $215,000 in stocks and bonds, rather than to invest in any rental property, and he may have been right. the stock market may have crashed but housing prices have gone down as well. so what do you think? have i made money by purchasing this condo or would i have fared better investing it in stocks and bonds, etc. [which i believe will go back up in value again]? dear iffy, how do you know that i "overpaid" for the property? you don't know what condos sell for in new hope pennsylvania!

You can take all your figures and plug them into a calculator to figure out if you've made money. Current Value - Total cost of purchase + rental income + tax breaks - expenses - increased income taxes = Return on Investment (ROI) While you didn't get a tax break for mortgage interest, you also didn't lose any money on interest, which is good. You also should be able to deduct some of your property taxes, upkeep expenses, and potentially rental depreciation.

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Hi! i want to become a freelance rental property manager on the florida panhandle. basically i will rent peoples' condos and beach houses out for them, make sure they are clean, and arrange maintenance and things like that. does anyone know: how/what percentage i get paid (ie 10% of the rental rate or cleaning fees, etc)? do i need any additional certificates (i have a ba in bus admin/marketing)? what laws go along with this? will the renter pay me directly then i pay the owner or vice-versa? any info or help will be greatly appreciated! thank you!

In Florida you need to have at least a sales associate license to rent out property for a year or more unless it is your own property. You cannot operate as a sales associate without being employed by a broker and cannot be paid by anyone but the broker. I'm not sure what the standard fee split between a property manager and broker is but that is always negotiable. I suggest you get your sales associate license and then speak with a few brokers in the area and see if any specialize in rentals. Sorry to rain on your parade but I think you will experience similar situations in other states.

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I currently pay: maintenance property management listing fees carpet steam cleaning paint and labor mortgage payment w/ taxes escrowed and the condo was unrented for 3 months this year which was a loss for me. it was available for rent for those 3 months and prior to august '09 it was rented out for 1 1/2 years. before that, i did live in the condo.

Deductible expenses for landlords include, but are not limited to, the following: Advertising, Cleaning and maintenance Commissions Depreciation Homeowner association dues and condo fees Insurance premiums Interest expense Local property taxes Management fees Pest control Professional fees Rental of equipment Rents you paid to others Repairs Supplies Trash removal fees Travel expenses Utilities Yard maintenance All expenses you deduct must be ordinary and necessary, and not extravagant. You can deduct the cost of travel to your rental property, if the primary purpose of the trip is business. If you mix business with pleasure, though, you're required to allocate the travel costs between deductible business expenses and nondeductible personal costs. Be careful not to cheat yourself on the breakdown. For all tax and legal matters you should consult your tax consultant and attorney. I hope this has been of some benefit to you, good luck. “FIGHT ON”

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I know i should subtract some expenses like 2 inspection visits (up to $3,500) and condo fees. but can i also subtract insurance or property tax or anything else? besides this, are there any additional techniques?

$3500 for inspection visit appears a lot, and only a reaonable amount is deductible, or capitalised as condo cost. And condo fees, prop tax and insurance are deductible only if the condo is used entirely for rental (no personal use of condo).

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Any thoughts out there, i need some assistance/help here is my situation - all involved (people/property) are in ontario, canada - bought condo in 2001 with ex for her mother to live in (purchased as joint tenants) - me and ex split 7 years ago. i agreed to let the condo situation stay "as is". - mother lived there until last december - ex (a real estate agent) ran up about $10k debt on property line of credit(loc) - ex refuses to pay interest on loc (6 years of it) - ex refuses to pay existing debts on property (ex. last years property taxes) - ex refuses to generate any financial statements on property while she was 'managing' it while her mother was there - ex now refuses to pay mortgage and condo fees. - during the period in question i have paid approx. $5k more then her in expenses(although her expense claim can not be verified) she claimed for the last 9 months that she wanted to buy me out. that offer has gone nowhere (we actually settled on her price and then she said she couldn't afford it). i want to sell but i also want to protect my interests against the debt that she has run up. note: i already had a lawyer on this. he was useless and did nothing to move this file forward. so, what can i do? i want to sell the property asap (and she now claims she does to), but i want to cover my butt against her racked up debt (could be as high as $20k). her offer is to sell; divide the proceeds 50-50 and then i am free to sue her (gee...thanks for that offer :o ). in that scenario, i will never see her again. i'm thinking that i should place a lien on the property for the $20k? is this even realistic? any other thoughts/options out there? help.......

First thing that you should probably do is to leaver her if she's really giving you problems. You might want to consider her offer so that the tax lien would solved. But if you still have feelings for her, might as well stay and think of other solutions. You can also get the services of a financial adviser to help you out or find another lawyer.

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We purchased a condo about 2 years ago with 30,000 down and we are now renting the condo out. with the condo fees, insurance and other expenses we are still paying aproximatley 1000,00 a month for this condo. we are also renting an apartment for 995.00 a month in our current location. we are thinking of selling the property soon but are unsure because of the market at this time.if we did not make at least our 30,000 back that we put down we feel as if we have just wasted the money. what should we do?

It all depends on your situation and the state the condo is located in. There are some very soft states at the moment such as California, Florida, Nevada, Arizona and could be a few years until we have a turnaround in these markets. The other important factor is if the condo is in a very desirable area that has high demand and great job market. You could always contact a realtor in that market (check out realtor.com) and they can let you know how strong or weak the market is where you own. If your condo has not appreciated you will actually lose money from the 30K you put down because you have closing costs including realtor commissions 5-6% as well as escrow/title fees. The other important factor is how much of a negative cash flow you have from what you receive in rents minus expenses and if you can sustain the negative cash flow for very long. Also condo's don't move as fast as single family homes as far as selling unless the market is in very high demand i.e. Los Angeles, Seattle, Manhattan etc... The other bigger picture is you will normally make money on this condo if you can hold on to it long term 7-15 years.

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My tenant pays $525 a month and my mortgage is $420 and condo fees are $130, so i take about a $20 loss per month. i don't want to lose valuable tax return money. i've owned the place for 3 years, and it is worth about 6,000 more than when i bought it. do i have to report it, i really don't want to take a hit on my return this year. my tenant pays $525 a month, and my mortgage is 420 and condo fees are 130, so does that qualify as a loss? or do i claim condo fees another way? well my issue is that if i just claim the mortgage and such, my return becomes around $1500 with my income, but if i claim it as a rental property, it becomes around $900. i and my "ignorance of the law" was an absurd comment because this is the first year i've been renting it, fyi, so i'm not sure how to claim it. so what's the best approach to fill it out? do i fill out all of the income paid per month and then deduct condo fees, mortgage ins, mortgage interest, and the garbage disposal that i fixed? anything else? i don't have any gas receipts, etc. from traveling the 10 miles to fix it, so vehicle expenses i don't plan on doing.

You must report all income you receive during the year. If it is rental income it must be reported on a Sch. E even if after deducting expenses it is a loss. See the link below to the IRS. Laura H – H&R Block – Senior Tax Advisor 5 **This advice was prepared based on our understanding of the tax law in effect at the time it was written as it applies to the facts that you provided.

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We live in wa and are going to buy a rental property in atlanta. the property will be rented out by a management company. my current thinking is condo would be better since the tenant can't screw up the exterior too much since the condo association will keep an eye on it and will maintain the outside; and it would be probably cheaper paying condo fee since we don't have to fix the structure of the property (the property we looked at are two beds with 950-1200 ft2 and low rise, price at 120k-180k, condo fee ranging from $250-$320, covering water, lawn, building insurance and liability insurance, garbage, reserve fund). but there are plenty of good deals on house in atlanta and house probably appreciates faster (with land). anybody can give us some advice and opinion on that? which make more sense?

Over the years I learned the hard way that rental property should be within a 5 mile radius of ones own home. Anything further is asking for trouble. If you have strong reasons for purchasing across the country, you are right that condos have fewer maintenance issues and single-family homes are quicker to appreciate.

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My wife and i are looking for a place to stay on the island arriving saturday, sep 4 and leaving friday, sep 10. there are lots of cottages, condos, small independent rental properties on the island along with hotels and resorts. i'm looking at trip advisor for reviews but i don't know how to pay so that i have some kind of protection. if i just rent a hotel or resort i can cancel and pay the fee or have some travelers insurance but most of these places that are privately owned have large deposits upfront. even the ones w/ lots of good reviews i'm worried if they want cash. i have some protection for services if i pay w/ my amex. with cash it's buyer beware. anyone ever rented a condo or rental place for a week? how did you pay? how was your stay? we're going to kauai. please no stupid responses.

Your best bet is to deal with someone who has been doing this for a while and preferably has feedback on their site. My daughter and her family rented a house on the Big Island earlier this year and had a few issues with the house upon arrival...like it looked like the refrigerator had not been cleaned since purchased! There were things growing in there that should not be. Anyway, they spent several hours that first evening cleaning the place up and after complaining to the owner, the owner reimbursed them their cleaning fee. It took a while, but they never disputed it, just took a while to get the money credited back to their account. Now, I realize that this wasn't a cash transaction, but still gives you an idea that things can go wrong. AMEX is one of the hardest cards to use because they charge the highest fees of all credit cards. So, two tips for you, unless its a really good bargain, try sticking to one that accepts credit cards. And, two, be prepared to use M/C or Visa. Good luck and enjoy your time on Kauai!