AboutRichard Fritzler Expertise I am in the business of tax planning for business owners. Our company helps business owners structure so that they can be reduce the taxes that they owe, making them far more profitable.
Experience Since 1986 I have been helping successful business owners reduce taxes, protect assets, and limit their liability. The company is Owelesstax, incorporated at www.owelesstax.com
Organizations National Small Business Owners Association.
Nevada Association of Listed Resident Agents.
Citizens Legal Association
The Business Owners Institute
Publications Contributing author to "The Corporate Standard Newsletter".
I am also a writer for an email newsletter about business
Googlegroups/Successfulbusiness
I am also an Expert in the areas of Tax Law, Retirement Planning, and Estate tax issues.
Expert: Richard Fritzler Date: 2/17/2008 Subject: income limits eligible deductions from real estate
Question Hi, I just had my taxes done and was told that I couldn't deduct any of the expenses i had related to the rental real estate I own. It was because my adjusted gross income was too high. the AGI was 150,000. I paid out approx 80,000 in expenses and I don't get to claim any of it. I've searched the internet to find out more info and can't find it. So, I don't want to repeat the same thing this year and I'm wondering if I need to set up a corporation. I'm not trying to get out of the taxes, but actually survive. Turns out, I paid out 80,000 in expenses to RE owned, will end up paying 60,000 in taxes all together, that is 140,000 subtracted from my AGI doesn't leave me with very much to live on. I've thought of selling the real estate, but want that to be the last resort. Do you have any info on if I should pursue setting up a corporate structure and how to be able to deduct the expenses so that I can offset somehow and live
Answer I can't state loudly enough "If you are going to be successful in business, DO THAT BUSINESS as all the most successful businesses do, AS A REAL CORPORATION."
A real corporation does not have an AMT, nor does it push you personally into Phase Out of your deductions.
A real corporation pays lower taxes, has better deductions, etc.
All of this is true unless you are operating a business that is not going to be profitable.
So before I just categorically claim the Real Corporation as the solution to your problem, we need to do a decision tree.
Question 1: Do you plan to be profitable?
If yes then choose a real corporation.
If no, rethink your plan. The Strip mall accountant community would argue that if you plan to lose money do so in some sort of passthrough entity like LLC or Sub-S so you can pass your losses to your personal tax return.
But that is just plain stupid.
Richard Fritzler
www.owelesstax.com
www.nevadacorporateservices.com
phone 800 590-6612
