Category: INVESTOR BOOKS

How to Enter Cash Purchase Using a Silent Private Lender

Posted on By Mike Butler

QUESTION from Stacey:
 
Hi Mike,
 
I’ve watched every video that I have access to, but I am still unclear on how to put in my private loan balances. 
 
For example, I purchased a property last year. 

I borrowed money from a private lender, put that in my account and then paid cash at closing. 
 
I entered the closing statement as a check.
 
Where do I enter the $50,000 loan I’m paying on every month? (I memorized a check I can send every month, but I don’t know where to put the balance of the loan.)
 
If I could have help with one of these properties, 
then I am hopeful  I could input the rest of them correctly. 
 
Please advise! Thanks!
 
Stacey

Please login to view more of this post
HOW TO VIDEOS, INVESTOR BOOKS, Borrow Money, Closing Statements, Memorized Transactions, Buying

1031 Tax Deferred Exchanges

Posted on By Mike Butler

How to enter properly is in your Investor Books Manual on Pages 173 thru 186

Page 173

Used by Investors to avoid paying Capital Gains Tax Now, you can defer it.
There are many variations involving 1031s including partials.
For KISS method purposes, example used will be simple and traditional.
• Investor has a house used for a rental for 10 years
• Investor purchased house 10 years ago for 50k
• Ballpark depreciation is 51,500 per year, reducing cost to 35k
• Investor can sell rental house for 140k resulting in 105k capital gain
• At 30% tax rate, could mean over 33k in Tax owed.
• Using the 1031 procedure PROPERLY, you could keep the 33k and roll it over into another like kind investment (1 or more rental houses)

Please login to view more of this post
INVESTOR BOOKS, 1031 Tax Deferred Exchange

Update IRS Tax Proposal on 100% Depreciation from Mike Grinnan CPA

Posted on By Mike Butler

Proposed Rules Address 100-Percent Depreciation Deduction

Proposed regulations address the new 100-percent depreciation deduction that allows businesses to write off most depreciable business assets in the year they are placed in service.


Background
The Tax Cuts and Jobs Act (TCJA) ( P.L. 115-97) amended Code Sec. 168(k) to increase the percentage of the additional first year depreciation deduction from 50 percent to 100 percent for property acquired after September 27, 2017. It also expanded the property eligible for the additional first year depreciation to include certain used depreciable property and certain film, television, or live theatrical productions.

Generally, the 100-percent depreciation deduction generally applies to depreciable business assets with a recovery period of 20 years or less and certain other property. Such assets include in part machinery, equipment, computers, appliances, and furniture.

The proposed regulations provide guidance on what property qualifies for the deduction, and rules for qualified film, television, live theatrical productions and certain plants.

Please login to view more of this post
INVESTOR BOOKS, Tax Updates

Q&A: Where to Enter Your Equity and Proper Use of CASH from Me

Posted on By Mike Butler

Where to Enter Your Equity and Proper Use of CASH from Me

  • with a dose of Crazy Advice from an Incompetent CPA

QUESTION from Cassandra:

Hi Mike,

I’m really enjoying your QuickBooksForInvestors system!!

Here’s my question….

I have heard you say you don’t bother with the Owner Equity account cause you let your CPA deal with that.

You say you use the “Cash from ME” (Long Term Liability) account when you infuse money into your business.

For short term interest-free loans to my business, this concept makes sense to me. But, if I infuse money to buy a property, I believe my CPA will complain because this Long Term Liability has no terms such as interest rate and loan period.

I’m also reading the IRS can easily challenge this and force me to treat it as equity.

My LLC expects to pay this infusion back once I sell the property several years down the road. So, how do I justify using a Long Term Liability account when there are no loan terms?

Also, how do I explain this showing up on the balance sheet as a long term liability when it is not a loan with terms?

Thank you,
Cassandra

Please login to view more of this post

INVESTOR BOOKS, Borrow Money

Earnest Money Paid To You When Selling a Property

Posted on By Mike Butler

How to Properly Enter
a $2,000 Earnest Money Check Paid to You

If You are a Licensed Real Estate Agent, You will deposit it into your Broker’s Escrow Account

QUESTION from Chuck: 

Hey Mike,

I am doing a wholesale deal. I will be doing a double close on it.
I received a $2,000 non-refundable deposit (EM but paid directly to me).

How do I enter a transaction like this. I tried to look it up on the videos but the link is broken. Thanks for the help

I tried to look it up on the videos but could not find this one.

Thanks for the help
Chuck C

Please login to view more of this post
HOW TO VIDEOS, INVESTOR BOOKS, Closing Statements, Earnest Money, Escrow Accounts, Selling