Tips on Property Investment|The Best Investment Properties Advice
Dec
28
clueless77 asked:
My wife and I live in a rented apartment in CA and own a home in AZ that we have rented out. Last year our losses on the AZ property (Interest + prop. taxes + repairs + depreciation – rentalincome) was 14K (reported in schedule E and form 6198). Now since our total W2 wages in CA are 150K we can’t deduct the 14K from our adjusted gross income. Question is can this no. be carried forward each year (as losses) and later when we sell the rental investment property can the sum of all these yearly losses be subtracted from the profit we make by selling the rental property?
My wife and I live in a rented apartment in CA and own a home in AZ that we have rented out. Last year our losses on the AZ property (Interest + prop. taxes + repairs + depreciation – rentalincome) was 14K (reported in schedule E and form 6198). Now since our total W2 wages in CA are 150K we can’t deduct the 14K from our adjusted gross income. Question is can this no. be carried forward each year (as losses) and later when we sell the rental investment property can the sum of all these yearly losses be subtracted from the profit we make by selling the rental property?
Also, someone suggested that the smarter thing to do would be to form an LLC and start getting a tax-break from the losses we are making every year. Is that true?
Christian
Comments
Mathew on 1 January, 2009 at 10:28 am #
The only one that will make any money by you forming an LLC is the attorney that does it for you. Do not form an LLC in California under any circumstances if you gross is under a million dollars and in most cases not in that case if you are doing it for tax purposes.
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