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If they haven't reported the rents as income (accrual basis) then there is no bad debt deduction available. Their tax deduction would be the expenses they incurred along the way.
But you understand my point, that the landlords are getting screwed over, right?
What "nice options" do property owners get that renters don't?
Equity? Ability to add, remove or paint? Deductions?
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Equity? Ability to add, remove or paint? Deductions?
Equity is not an option, its what they have because they chose to put their capital into a property. WHo knows where the renter put their capital, but that's their choice.
Ability to add, remove or paint? You mean the obligation to repair and maintain the property so they can hopefully earn money from their investment?
Deductions? You mean being able to lower their income from the property by the money they spend to operate it or depreciate the capital investment? It's a business, is that a "nice option" for a restaurant to be able to deduct the cost of food and compensation to cooks and servers? Maybe the government can issue a moratorium on prosecuting people who dine and dash sine restaurants have such nice options.
Equity is not an option, its what they have because they chose to put their capital into a property. WHo knows where the renter put their capital, but that's their choice.
Ability to add, remove or paint? You mean the obligation to repair and maintain the property so they can hopefully earn money from their investment?
Deductions? You mean being able to lower their income from the property by the money they spend to operate it or depreciate the capital investment? It's a business, is that a "nice option" for a restaurant to be able to deduct the cost of food and compensation to cooks and servers? Maybe the government can issue a moratorium on prosecuting people who dine and dash sine restaurants have such nice options.
I was talking about homeowners. Looking back it looks like they were talking about the landlords?
I had two rental properties for about a decade, most renters could barely afford the rent, let alone invest. My property doubled in value. It did great things for my taxes.
I had another in San Fran for a year, that went awesome and I made a bundle and only kept it for a year.
I would much rather be the property owner then the renter, but my home and rentals were all in very high COLAs.
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I was talking about homeowners. Looking back it looks like they were talking about the landlords?
I had two rental properties for about a decade, most renters could barely afford the rent, let alone invest. My property doubled in value. It did great things for my taxes.
I had another in San Fran for a year, that went awesome and I made a bundle and only kept it for a year.
I would much rather be the property owner then the renter, but my home and rentals were all in very high COLAs.
I think they were talking about landlords as well.
Owning rental property can work out, but it's a job and isn't necessarily easy money. You're also taking risk that the property doesn't rent or the area goes downhill and the value declines or the tenant trashes the place and skips out on you. Lots of things can go wrong.
While I think CA government is insane and has been for some time, why should renters get a free ride on the backs of landlords?
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The original theory was that evicted renters would go elsewhere & stay with family/friends, possibly in another state -- and that this would be a vector for virus transmission, making the pandemic worse.
But now that everyone who wants the vaccine has received an injection, I find the original argument no longer to be valid.
Equity? Ability to add, remove or paint? Deductions?
They get to make a lot of the policies. If they ever want live there again, they can always kick the tenants out when the lease ends. You pay taxes, but rent is sometimes set to cover for property taxes. When I rented out my property, it easily covered the mortgage (although condo fees and property taxes were on me. Along with repairs. But some of them were written off at tax time).
Quote:
Originally Posted by leadfoot4
But your over simplistic statement overlooks something...the landlord provides a "service", in exchange for rent money. The service includes a roof over the tenants head, running water, and electricity. Currently, the Government has stepped in and said that the landlord cannot evict the tenant for non payment of rent.....but the landlord is still expected to provide a roof, water, and electricity, AND PAY FOR IT OUT OF HIS OWN POCKET.
This Covid fiasco has been going on for close to 18 months, and for the sake of simplicity, let's say that the average, decent sized apartment rents for $1000/month. That means the average landlord is out $18,000. How many renters, do you think, will either be honest enough, or better yet, have that $18,000 to pay the landlord, when the "rent vacation" legally comes to an end? This means that a LOT of landlords are going to be "taking it in the shorts". Will they at least be able to take a tax deduction for this loss??
This is absolutely nuts!!
Truth be told, the government can save a lot of money by cutting back on both essential and nonessential services. People get injured for VERY STUPID reasons, but we do try to save their lives.
What would the solution have been? If you evict the tenants, do you really believe that other tenants would be lining up to rent when many were in the same situation of having their jobs on hold (this is a serious question)? We'd still need to deal with those who got evicted anyways. LL are getting their money back. There are still a lot of issues, but we had, and STILL ARE in the midst of a pandemic. Make no mistake about it, life is NOT returning back to pre-COVID times
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