Author Topic: Classifying expenses and minimizing taxes - info recommendations?  (Read 861 times)

NeonPegasus

  • Bristles
  • ***
  • Posts: 374
  • Location: Metro Atlanta, GA
    • Neon Pegasus
I have two duplexes and have had a very spendy year. I want to ensure that I'm classifying all expenses properly and in the best way possible to minimize my taxes this year. It looks like I will show a profit on one and a loss on the other and when I work on the Passive Activity Loss Limitations worksheet it looks like the profit on one will count double against deducting the losses on the other. Or maybe I interpreted the instructions wrong. Anyway, if I can keep my AGI under a certain level, it will help me not only minimize taxes but avoid having to recharacterize my trad IRA contributions.

Are there any web resources you could refer me to that will really get into the differences between property maintenance versus property improvements and whether I can opt to depreciate rather than expense if I am hitting the threshold for deducting expenses? I'd really like some in depth info on tax optimization for properties in the U.S.
« Last Edit: August 16, 2017, 11:50:15 AM by NeonPegasus »

SeattleCPA

  • Handlebar Stache
  • *****
  • Posts: 1523
  • Age: 60
  • Location: Redmond, WA
    • Evergreen Small Business
Re: Classifying expenses and minimizing taxes - info recommendations?
« Reply #1 on: August 16, 2017, 01:50:20 PM »
This blog post we did a while back should help you:

http://evergreensmallbusiness.com/small-businesses-and-the-new-sec-263-repair-regulations/

This discussion of partial dispositions might also educate you:

http://evergreensmallbusiness.com/partial-dispositions-and-the-new-tangible-property-regulations/

BTW, you do not--repeat, do not--need the TPR mongraph advertised on those web pages. That is for tax practitioners and not DIY tax return preparers.

NeonPegasus

  • Bristles
  • ***
  • Posts: 374
  • Location: Metro Atlanta, GA
    • Neon Pegasus
Re: Classifying expenses and minimizing taxes - info recommendations?
« Reply #2 on: August 16, 2017, 06:51:53 PM »
Awesome. Thanks!