yimyammer
shitless classpainter
- Joined
- Sep 11, 2019
- Messages
- 3,271
alright, now were in my wheelhouse so I can confidently comment on this issue as I am a CPA and real estate investor for the last 30 yearsYeah that is bullshit. There was a tax cut to real estate owners which was retroactive. So weird, I wonder why they wanted a tax cut for real estate people...who would benefit?
Bonanza for Rich Real Estate Investors, Tucked Into Stimulus Package (Published 2020)
A small change to tax policy could hand $170 billion in tax savings to real estate tycoons.www.nytimes.com
first of all, as I suspected, the republicans are pulling the same BS as dems by sneaking in whatever they can into this massive document, gawd only knows what else is in this huge document, per the article:
I suspect there isn't one single congress
Having said that, I don't think its accurate to call this a "cost". Its actually a way of reporting your taxes that reduces the net taxable income now versus future years which in essence will be a wash, from the article again:
depreciation can be a non cash expense that eventually becomes an actual expense or was a valid expense that is forced to be spread over the life of the use of that expense versus taking the entire cost in the year it was incurred. So, its really a way of spreading those expenses over the life of their use versus expensing them all in a single year. In fact, when I do huge capital improvement, I have to depreciate them over time. And surprise, surprise, over time the building depreciates in real life too. It has to be painted every 5 or so years, new roofs every 20 or so years, new AC units every 8-10 years, etc, etc, etc. so why wouldn't these expenses be allowed to be deducted from total revenues to arrive at taxable profit?
Further, if I lose money on my duplex say I lost $10,000 in one year, so I sold some stock to help make up for my loss and the profit on the stock I sold was $15,000. Why shouldn't I (or anyone else) be able to deduct the loss on one investment from the gain of another to arrive at a net taxable profit of $5,000?
If I ran a t-shirt business and one shirt made a profit of $15,000 and the other shirt lost $10,000, there would be no question that the two should be combined to arrive at the actual net profit.
Every other business would do the same damn thing. No one would ever suggest that a restaurant owner cant deduct the price of their hamburger meat from their total revenues to determine taxable profit, but because real estate requires the ability to have lots of cash or access to debt, people like to demonize property owners as "rich real estate investors" to justify all manner of illogical nonsense.
As an aside, I'm noticing a rising tide of tenants making comments on Facebook that are having a similar sentiment where they demonize the landlord as some sort of slime that has screwed them over. Nevermind the fact they chose the place they live, the gestapo didn't come in the middle of the night and force them to reside in their current space. But I guess when you're a lazy piece of shit, the best thing you got going for you is to attack folks that aren't so you can justify not paying your rent, check these comments out:
Anyway, back to the point. If a person has a variety of business they're involved in and some make money and some don't, I don't understand why you shouldn't be allowed to aggregate them altogether to arrive at net taxable income so as a real estate investor, I would welcome this change and it will help folks, especially the smaller investors. And because this bill is an attempt to give economic relief to all business effected during this crisis, I can understand how it became part of the package.
Its really nothing more than a timing issue because prior to this revision, you had to carry forward losses against future gains which ultimately does the same thing in the future that this bill allows for happening now.
But as a person who is concerned about the virus getting addressed ASAP and helping the economy suffer the least, I can see how some people who dont understand how all this works would feel this is some sort of sneaky thing for so called "rich people".
Sure the wealthy will benefit from this now but so will all the other small property owners who have worked their asses off to acquire a property or two they hope to have paid off in 20+ years so they can have something when they're older to live off of.
My plumber is a great example. He came here from Mexico, didn't speak the language & realized he needed to understand English to succeed here and learned it. He also learned how to be a plumber and he's a great one. Over the last 15 years he bought a house for himself that he lived in and then eventually bought another one and moved into it and rented his old one and is now building a new house where he plans to keep the other two and rent those out as well.
And this is a guy not born here, didn't know the language yet busted his ass and found a way to be successful. So if he loses money in his plumbing business this year because of the slow down, your damn right he should be able to deduct those losses against any gains he makes on real estate. (and vice versa).
And so should everyone else who is in business, even if they fall under the dreaded category of "the rich"
And PS..my plumber just proves what a person can still do in this country with a great work ethic, an excellent attitude and a willingness to make sacrifices now for long term benefit
/rant
