Investment Seminar Template
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This 3 sentence summary provides the essential information from the document: This document was presented by Betty Kincaid and discusses having a personal investment policy. It also includes an address of 4128 Story Rock Las Vegas, NV 89115 and lists the property's MLS number as 1189472. The document focuses on developing an investment strategy and identifying a specific property for sale.
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Investment Seminar Template
- 1. Presented by: Betty Kincaid
- 15. Do you have a personal investment policy?
- 23. 4128 Story Rock Las Vegas, NV 89115 MLS# 1189472
Editor's Notes
- Add your name/picture and bio
- Education Stock House This is a great time to have the group get all their horror stories out. Make notes so that you can bring some of the issues up later in the program.
- Ask for other investments: Business ventures Commodities Direct real estate ownership
- Depreciation is a non-cash deduction from taxable income based on the economic life of the improved real property Improved residential real estate has an economic life of 27.5 years. When you sell the real estate that has been depreciated you must recapture all of the depreciation. This means you have to add up all the depreciation you’ve deducted on your taxes since you’ve owned the property and pay taxes on this amount. The current recapture rate for real estate is 25%. If you used an accelerated method to depreciate any of your real estate improvements, you’ll have to recapture this excess depreciation at your ordinary income tax rate. Depreciation is not an option. You must recapture depreciation when you sell so you may as well take the depreciation each year that you own the property. Since 1986, all real estate investments are considered passive and therefore investors are limited to deducting a maximum of $3,000 of real estate losses against other active income. To get around the passive loss rule, you must meet the requirements of active real estate investor or real estate professional. These requirements include: Performing over 750 hours of personal service during the tax year in real estate trades and businesses Over half of her personal services performed during the tax year were in real property trades and businesses If you hold the real estate for 1 year plus 1 day, you qualify for long-term capital gains treatment on any gain (profit). For 2011 and 2012 the long-term capital gain rate is 0% for taxpayers in the 10 and 15% tax bracket and 15% for everyone else. Starting in 2013, long-term capital gain will be 10% for taxpayers in the 15% tax bracket and 20% for everyone else. If you do everything right you’ll make a profit when you sell your real estate investment. If you don’t want to pay even the lower capital gains tax, you can do a 1031 exchange and defer your capital gain taxes as well as your depreciation recapture taxes. Most of these benefits are available only to the real estate investor.
- No other asset lets you borrow 80% of it’s value. Stocks are levergable at 40-50%, bonds 50-60%. When you use the power of leverage, you accelerate your return because you’re getting a return on borrowed money. As long as your return in higher than the rate at which you borrow your money, you’ll prosper every time. 20% down payment, fixed rate mortgages, 15 or 30 years in length are prudent,, conservative and recommended.
- Make your money going in. Buy under market. Buy a property that cash flows from day 1 Improve the property, gradually raise the rental rates. The tenant pays the mortgage. As the mortgage decreases, the owner equity increases.
- Anyone can look up ownership records, pull property profiles and bid at foreclosure auctions. The internet gives you everything from floor plans to HOA ratings. You can choose to manage the property yourself or hire a professional property manager. Are you handy? You can add value to a property by adding your services: Decorating Carpentry Marketing Financing
- We learned all about the first 2 these last few years. Values aren’t guaranteed but if you buy at the best possible price, be conservative with leverage and keep your properties rented which means cash flowing then you’ll be okay. A professional, thorough property inspection will help prevent major problems in the future. I also get a home warranty for all my residential properties.
- A quick way to lose everything is to try to work outside your area of expertise. Just because you own a property doesn’t mean you’re qualified to manage it. Know when you need professional help and get it. Join or get involved with professional organizations who track legislation that affect your business. You’ve worked hard for your money and your assets, don’t let unexpected accidents take it all away. Make sure you have liability insurance as well as the proper legal framework for your business.
- We recommend each investor have a written personal investment policy that addresses each of these characteristics A sample policy is available at BettyKincaid.com
- Lease Option Single/Multi Family
- You can go into detail here or not depending on time.
- We recommend each investor have a written personal investment policy that addresses each of these characteristics A sample policy is available at BettyKincaid.com