Secrets of the Rich
In the past five editions, we have covered the Seven Proven
Steps that the rich use to make and grow their money. In the
first edition, we covered the overview of the system and debuted
the seven steps:
- Create a Business.
- Discover Your Hidden Business Deductions.
- Pay Your Taxes.
- What’s Left Goes Into Real Estate.
- Real Estate Income Comes Out Tax-Free.
- Buy a House the Right Way.
- Make Your House Give You Money.
Last month we discussed the strategy of using your business
income to buy real estate. One more strategy to convert
business income into passive income is to buy the building that
your business is located in. You would hold the property within
an asset-protection entity such as a Limited Liability Company
(LLC) or a Limited Partnership (LP). Your business would then
pay rent to your LLC or LP. This reduces the earned income
within your business. The income flows through to your LLC or
LP and offset by the expenses of the property and the phantom
expense, depreciation. You’re growing wealthier as your
property goes up in value and paying for it all with before-tax
dollars from the business.
Loans
Your property goes up in value – now what? If you’ve
determined that leverage is part of your wealth-building
strategy, then you’re going to want to use that equity (equity
is the difference between the asset value and the current loan
balance) to continue to build your wealth. If you haven’t
already done so, go to the Real Estate Wealth Builder at www.taxloopholes.com. You’ll see how leverage
can build your wealth more quickly; by using the equity gain in
your first property to buy more property.
The easiest way to get to the leverage potential within your
property is to refinance and take out the excess equity. This
type of refinancing is typically called a “cash-out refi.” The
proceeds will not be taxable and if you use the money for other
investments, the extra interest is still tax-deductible. If
instead you refinance and take money out to use for personal
expenses, the interest attributable to the personal-use funds
will not be deductible.
Cash Flow Without Tax
If you’ve bought the right property, you will have positive
cash flow each month. The cash flow is the amount that you
receive after all property expenses are paid. That’s the
passive income that you get to put in your pocket. The best
part of all is when you get to put that cash flow in your pocket
WITHOUT paying taxes. That’s where the phantom expense of
depreciation comes in.
Depreciation is a deduction that the IRS allows you to take
based on the premise that your property is going to go down in
value. In fact, they feel that it’s going to be completely
worthless in 27.5 years (residential) or 39 years (commercial).
Subtract the value of the land from the total property basis
(generally the amount you paid for the property) to determine
the total amount that can be depreciated. This depreciation
doesn’t cost you anything, but does reduce the taxable amount
that you have to report and pay taxes on.
Now here’s a loophole – allocate the depreciable value between
real and personal property. Personal property includes the
washer, dryer, refrigerator, store, air conditioning unit and
the like. These items can all be depreciated over a period of
5 – 18 years. That means that you get more depreciation in the
first few years and can generally even create a tax loss even
when there is still cash flow. For more information on how to
allocate land, real and personal property, see Easy
Accounting for Real Estate Investors available at www.taxloopholes.com.
Even further benefits available from real estate are tax
credits. Tax credits directly reduce the amount of tax you pay,
so they are much more beneficial then tax deductions. Just a
few of the tax credits available are: (1) Low Income Housing
Credit (2) Pre-1936 Construction (3) Historical Properties and
(4) ADA. Of these, my favorites are (2) through (4)./ Low
Income Housing Tax Credits are available but are generally
distributed on a political basis. They aren’t as certain. The
pre-1936 construction and historical property tax credits come
about when you rehab a property that is either old (pre-1936) or
historical. Provided you meet certain requirements, you will be
able to take as a tax credit up to 20% of the improvement costs.
The ADA tax credit is earned when you improve a property so that
it is accessible to disabled individuals. You can take up to
$5,000 per year in this tax credit. For more information on tax
credits, see 101 Tax Loopholes, also available at www.taxloopholes.com.
Like-kind Exchanges
Do you remember playing Monopoly as a child? Do you remember
exchanging four green houses for one red hotel? That was a like-
kind (aka 1031 aka Starker) exchange. The like-kind exchange
allows you to exchange one or more investment properties for one
or more other investment properties. When you do this,
following certain time limit requirements, you are able to
“roll” the basis over from the sold property to a new property.
You have thus deferred the tax on this property into the new
property.
HomeLoopholes™
We’ve covered three of the tax-advantaged ways to use your real
estate to build your wealth. In this case, the real estate was
all investment property. There is one more real estate asset-
building technique. That’s to use the great tax advantages
available for your principal residence. Steps Six and Seven
will discuss HomeLoopholes that are available for your principal
residence. Learn how to change your home from a liability to an
asset with these HomeLoopholes..
Diane Kennedy is a CPA/Tax Strategist and the author of the best-selling book Loopholes of the Rich: How the Rich Legally Make More Money and Pay Less Tax and co-author of the best-selling book
Real Estate Loopholes: Secrets of Successful Real Estate Investing. For more information on how to legally use the tax loopholes and make the IRS your partner, contact Diane's CPA firm, DKA, at 888-592-4769 or www.dkacpa.com. Tax law is constantly changing! Keep up to date for free by signing up for a free e-newsletter at www.taxloopholes.com
Piece of writing writing is also a fun, if you know then you
can write if not it is complicated to write.
I do not even understand how I finished up right here, however I thought this post used
to be good. I do not recognize who you might be however certainly you’re going to a famous blogger in the event you aren’t already.
Cheers!
Excellent pieces. Keep posting such kind of information on your site.
Im really impressed by it.
Hello there, You’ve performed a great job.
I will definitely digg it and personally recommend to my friends.
I am sure they will be benefited from this website.
Write more, thats all I have to say. Literally, it
seems as though you relied on the video to make your point.
You obviously know what youre talking about, why throw away your
intelligence on just posting videos to your weblog when you
could be giving us something enlightening to read?
Thanks for your marvelous posting! I truly enjoyed reading it,
you could be a great author.I will always bookmark your blog and
will come back at some point. I want to encourage that you continue
your great posts, have a nice holiday weekend!
Greetings! Very helpful advice within this article! It is the little changes which will make the greatest changes.
Thanks a lot for sharing!
I’m extremely inspired with your writing abilities as well as with the structure to your weblog.
Is that this a paid subject matter or did you customize it your self?
Anyway stay up the nice high quality writing, it’s uncommon to peer a great
weblog like this one these days..
I’m not sure why but this web site is loading extremely slow for me.
Is anyone else having this issue or is it a problem on my end?
I’ll check back later and see if the problem still exists.
Hello there, just became alert to your blog through Google, and found that it is really informative.
I’m going to watch out for brussels. I’ll appreciate if you continue
this in future. A lot of people will be benefited
from your writing. Cheers!
It’s not my first time to pay a quick visit this site, i
am browsing this web page dailly and get pleasant information from here all the time.
My spouse and I absolutely love your blog and find the majority of
your post’s to be exactly what I’m looking for. can you offer guest writers
to write content for you personally? I wouldn’t mind producing a post or elaborating on some of the subjects you
write with regards to here. Again, awesome website!
magnificent post, very informative. I’m wondering why
the opposite specialists of this sector don’t notice this.
You must proceed your writing. I’m confident, you’ve a great readers’ base already!
Nice post. I learn something new and challenging on blogs I stumbleupon on a daily basis.
It will always be helpful to read articles from other writers and use a little something from other web sites.
Hi there I am so delighted I found your blog, I really found you by error, while I was searching on Google for
something else, Anyhow I am here now and would just like to say many thanks for
a fantastic post and a all round entertaining blog (I also love the theme/design), I don’t have time to look over it all at the minute
but I have bookmarked it and also added your RSS feeds, so when I have time I will be back to read much more, Please do keep up the excellent work.
Hi my family member! I wish to say that this post is amazing, nice written and include approximately all vital infos.
I would like to see extra posts like this .
Heya i am for the primary time here. I found
this board and I find It truly helpful & it helped me out a lot.
I hope to give something again and help others like you aided
me.
Wonderful article! We are linking to this particularly great
article on our site. Keep up the good writing.
Having read this I thought it was rather enlightening.
I appreciate you spending some time and energy to put this information together.
I once again find myself personally spending a significant amount of time both reading and commenting.
But so what, it was still worth it!
Hola! I’ve been reading your site for some time now and finally got the bravery to go ahead and give you a shout out from New Caney
Tx! Just wanted to tell you keep up the fantastic job!
I loved as much as you will receive carried out right here.
The sketch is tasteful, your authored material stylish.
nonetheless, you command get bought an nervousness over that you wish be delivering the
following. unwell unquestionably come more formerly again since
exactly the same nearly very often inside case you shield this hike.
Asking questions are actually fastidious thing if you are not understanding anything fully, except this article offers fastidious
understanding even.
What’s up colleagues, its impressive paragraph about educationand completely explained, keep it up all the time.
Have you ever considered creating an e-book
or guest authoring on other websites? I have a blog based upon on the same information you discuss and would
really like to have you share some stories/information. I know
my viewers would appreciate your work. If you are even remotely interested,
feel free to shoot me an e-mail.
Piece of writing writing is also a fun, if you be acquainted with then you can write or else it is complicated to
write.
Great beat ! I would like to apprentice while you amend
your web site, how can i subscribe for a blog site?
The account aided me a acceptable deal. I had been tiny bit acquainted of this your broadcast offered bright clear idea
Today, I went to the beachfront with my kids.
I found a sea shell and gave it to my 4 year old daughter and said “You can hear the ocean if you put this to your ear.” She put the shell to
her ear and screamed. There was a hermit crab inside and it pinched her ear.
She never wants to go back! LoL I know this is totally off topic but I had to tell someone!
Hello! I could have sworn I’ve been to this site before but after
browsing through some of the articles I realized it’s new to
me. Regardless, I’m definitely delighted I stumbled upon it and I’ll be book-marking it and checking back
often!
You could definitely see your skills within the
article you write. The sector hopes for even more passionate writers like you who are not afraid
to say how they believe. Always go after your heart.
Simply desire to say your article is as amazing.
The clearness in your post is simply excellent
and i can assume you are an expert on this subject. Fine
with your permission allow me to grab your RSS feed
to keep up to date with forthcoming post.
Thanks a million and please keep up the enjoyable work.
Wonderful article! This is the type of info
that are supposed to be shared across the net. Shame on Google for now not positioning this put up higher!
Come on over and seek advice from my website . Thank you =)
I was curious if you ever thought of changing the
page layout of your website? Its very well written; I love
what youve got to say. But maybe you could a little more in the way of content so people could connect with it better.
Youve got an awful lot of text for only having one or two images.
Maybe you could space it out better?
I love your blog.. very nice colors & theme. Did you make this website yourself or did you hire someone to do it for you?
Plz answer back as I’m looking to create my own blog and would like
to find out where u got this from. thanks a lot
Informative article, just what I was looking for.
These are truly enormous ideas in regarding blogging.
You have touched some nice things here. Any way keep up
wrinting.
Yes! Finally someone writes about Sling TV.
Excellent post. I was checking continuously this blog and I’m impressed!
Very useful information specially the last part 🙂 I care for such info much.
I was seeking this certain info for a very long
time. Thank you and best of luck.
You actually make it appear so easy together with your presentation but I to find this topic to be actually something that I believe I might never understand.
It seems too complicated and extremely broad for me.
I’m taking a look ahead to your subsequent put up,
I will attempt to get the dangle of it!
I am regular reader, how are you everybody? This post posted
at this site is truly good.
Oh my goodness! Impressive article dude! Many thanks, However
I am having troubles with your RSS. I don’t know why
I can’t join it. Is there anybody getting the same RSS issues?
Anyone who knows the answer will you kindly respond?
Thanks!!
Thanks for sharing your thoughts. I truly appreciate your efforts and I am waiting for
your next write ups thanks once again.
I just could not go away your website prior to suggesting that I actually loved the usual information a person supply
to your visitors? Is going to be back often in order
to inspect new posts
There is certainly a great deal to learn about this issue.
I like all the points you have made.
If you want to get a good deal from this article then you have
to apply such strategies to your won web site.
Keep on writing, great job!
You need to take part in a contest for one of the best sites on the internet.
I am going to highly recommend this web site!
It’s awesome in support of me to have a site, which is useful in favor of my experience.
thanks admin
When I initially commented I clicked the
“Notify me when new comments are added” checkbox and
now each time a comment is added I get three emails with the same comment.
Is there any way you can remove me from that service? Thanks a lot!
Everyone loves what you guys tend to be up too. Such clever work
and reporting! Keep up the very good works guys I’ve added you guys
to blogroll.
Sling tv coupons and promo codes for november 2018
Touche. Outstanding arguments. Keep up the amazing work.
Sling tv coupons and promo codes for november 2018
I need to to thank you for this excellent read!! I definitely enjoyed every little bit of
it. I’ve got you saved as a favorite to check out new stuff you post…
I was excited to uncover this website. I wanted to thank you for ones
time due to this fantastic read!! I definitely loved every
bit of it and i also have you saved to fav to check out new stuff
in your web site.
Heya i am for the first time here. I came across this board and I find It
really useful & it helped me out much. I hope
to give something back and aid others like you
aided me.
First of all I want to say wonderful blog! I had a quick question in which I’d like to ask if you
don’t mind. I was interested to know how you center yourself and clear your thoughts prior
to writing. I have had a hard time clearing my thoughts in getting my thoughts out there.
I truly do take pleasure in writing however it just seems like the first 10 to 15 minutes are lost simply just trying to figure out how to begin. Any ideas or
hints? Cheers!
Whats up this is kind of of off topic but I was wanting to know if blogs use WYSIWYG editors or if you have to manually code with HTML.
I’m starting a blog soon but have no coding experience so I wanted to get advice from someone with experience.
Any help would be enormously appreciated!
Hi there, just became alert to your blog through Google, and found that it’s truly informative.
I’m gonna watch out for brussels. I’ll be grateful if you
continue this in future. A lot of people will be
benefited from your writing. Cheers!
What’s up, I log on to your blogs regularly. Your story-telling style is witty, keep up the good work!
Wow, amazing blog format! How lengthy have you been running a blog for?
you made running a blog look easy. The total look of your web
site is fantastic, let alone the content!
It is really a nice and useful piece of information. I’m satisfied
that you just shared this helpful information with
us. Please keep us informed like this. Thank you for sharing.
You actually make it appear really easy with your presentation however
I in finding this matter to be actually something which I think I might by no means understand.
It sort of feels too complex and very broad for me. I am taking
a look ahead to your next post, I’ll try to get the
dangle of it!
Howdy! I know this is kinda off topic but I was wondering which blog platform are you
using for this site? I’m getting sick and tired of WordPress because I’ve had problems with
hackers and I’m looking at options for another platform. I would be fantastic if you
could point me in the direction of a good platform.
Please let me know if you’re looking for a article writer for your weblog.
You have some really good posts and I believe I would be a good asset.
If you ever want to take some of the load off, I’d love
to write some content for your blog in exchange for a link back to mine.
Please blast me an email if interested. Thank you!
I know this website gives quality depending articles or reviews and
additional stuff, is there any other site which
provides these kinds of things in quality?
Hi, I do think this is an excellent site. I stumbledupon it 😉 I’m going to come back once again since I saved as a
favorite it. Money and freedom is the greatest way to change,
may you be rich and continue to help others.
I will immediately snatch your rss feed as I can’t to find your e-mail subscription link or e-newsletter service.
Do you have any? Kindly permit me recognise so that I could subscribe.
Thanks.
My partner and I stumbled over here from a different website and thought I might as well check things out.
I like what I see so i am just following you. Look forward
to finding out about your web page again.
Just wish to say your article is as surprising. The clarity on your publish is just great and that i can assume you are knowledgeable on this subject.
Fine together with your permission let me to grab your RSS feed to
keep up to date with approaching post. Thank you one million and please carry on the rewarding
work.
I could not resist commenting. Exceptionally well written!
I am not positive the place you’re getting your information, but great topic.
I must spend some time finding out more or figuring out more.
Thank you for excellent information I was on the lookout for this information for my mission.
It is perfect time to make some plans for the longer term and it is time to be
happy. I have read this post and if I may just I desire to suggest you some attention-grabbing things or advice.
Perhaps you can write next articles regarding this article.
I want to learn even more issues approximately it!
Thanks for sharing your thoughts on minecraft. Regards
Thank you a lot for sharing this with all folks you really realize what you’re
talking about! Bookmarked. Please additionally consult with my web site =).
We could have a link change arrangement among us
Very shortly this site will be famous among all blog viewers, due
to it’s pleasant articles or reviews
You actually make it appear really easy with your presentation but I in finding this topic to be really one thing which I think I might by no means understand.
It seems too complex and extremely huge for me. I’m having a look forward for your subsequent
post, I will try to get the dangle of it!
This is my first time pay a quick visit at here and i am truly happy to read all at one place.
I know this web page gives quality based content and additional data, is there any other web site which offers these stuff in quality?
It’s actually a cool and useful piece of info. I am happy that you simply
shared this helpful information with us. Please keep us
informed like this. Thanks for sharing.
I think this is among the such a lot vital information for me.
And i am happy reading your article. But want to observation on few basic things, The
website taste is ideal, the articles is truly excellent :
D. Good job, cheers
Admiring the hard work you put into your website and detailed information you offer.
It’s great to come across a blog every once in a while that isn’t the same unwanted rehashed information. Excellent read!
I’ve saved your site and I’m adding your RSS feeds to my Google account.
Hello, i think that i saw you visited my web site thus i came to “return the favor”.I am attempting to find things to improve my web site!I suppose its ok
to use some of your ideas!!
It’s an remarkable article designed for all the internet viewers; they will get benefit from it I am sure.
After going over a few of the blog posts on your web page, I truly like your technique
of blogging. I book-marked it to my bookmark website list and will be checking back in the near future.
Take a look at my website as well and tell me how you feel.
It’s perfect time to make some plans for the longer term and it’s time to be happy.
I’ve read this put up and if I may I desire to recommend you some fascinating things or tips.
Perhaps you could write next articles regarding this article.
I wish to read even more issues approximately it!
Thanks for sharing your thoughts about minecraft. Regards
I am not sure where you are getting your info, but good topic.
I needs to spend some time learning much more or understanding more.
Thanks for wonderful info I was looking for this information for my mission.
Every weekend i used to pay a quick visit this website, as i
want enjoyment, for the reason that this this website conations
in fact fastidious funny stuff too.
It’s in fact very complicated in this busy life to listen news on Television, so I only use world wide web for that
purpose, and get the hottest information.
I do agree with all the ideas you’ve presented to your post.
They’re really convincing and can certainly work.
Still, the posts are too short for newbies. May just you please prolong them a bit from
next time? Thank you for the post.
Hola! I’ve been following your site for a while now and finally got the bravery to go ahead and give you
a shout out from Dallas Texas! Just wanted to tell you keep up the great job!
I do accept as true with all of the ideas you have offered to your post.
They are very convincing and will certainly work.
Nonetheless, the posts are very brief for newbies.
May just you please lengthen them a bit from
subsequent time? Thank you for the post.
Good day! Would you mind if I share your blog with
my zynga group? There’s a lot of folks that I think would
really enjoy your content. Please let me know.
Thanks
It’s an awesome paragraph in support of all the web visitors; they
will take benefit from it I am sure.
Ahaa, its nice discussion concerning this paragraph at this place at this blog, I
have read all that, so at this time me also
commenting here.
Excellent weblog right here! Also your web site so much up very
fast! What host are you the usage of? Can I am getting your affiliate link in your host?
I desire my website loaded up as quickly as
yours lol
I all the time emailed this blog post page to all my friends,
since if like to read it next my contacts will too.
It’s going to be finish of mine day, but before ending I am reading this
great article to increase my know-how.
I am really impressed with your writing skills as well as with the layout on your
weblog. Is this a paid theme or did you customize it yourself?
Anyway keep up the nice quality writing, it’s rare to see a nice blog like this one today.
natalielise plenty of fish
It’s very trouble-free to find out any topic on net as
compared to books, as I found this post at this site.
plenty of fish natalielise
Thanks for sharing such a good thought, paragraph is nice, thats why i have read it completely natalielise pof
Aw, this was a really good post. Taking the time and actual
effort to generate a superb article… but what can I say… I hesitate a whole lot and never
seem to get nearly anything done.
What’s up, I check your blogs on a regular basis.
Your writing style is awesome, keep it up!
We are a bunch of volunteers and opening a new scheme in our community.
Your website provided us with useful information to work on. You’ve performed
a formidable job and our whole community might be thankful
to you.
Do you have a spam issue on this website; I also am a blogger, and I was wondering your situation; we have developed some nice methods and we are looking to exchange techniques with
others, why not shoot me an email if interested.
Hi! I understand this is kind of off-topic however I needed to ask.
Does operating a well-established website such as yours require a lot
of work? I am completely new to operating a blog however I do write in my diary daily.
I’d like to start a blog so I can easily share my personal
experience and views online. Please let me know if you have any kind of
suggestions or tips for brand new aspiring blog owners.
Thankyou!