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Old 01-25-2013, 06:41 AM
Location: Baltimore
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You can depreciate the property on your taxes as a rental. The deduction can be significant, even with income coming in.
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Old 01-25-2013, 07:39 AM
Location: Blue Ridge Mntns., NC
10,299 posts, read 14,180,170 times
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Tax benefits are not a good reason to carry debt. The best scenario is try to get the relo company to help you out with a package and put the Chicago house in the rear view mirror. Renting is simply asking for more problems, and the tenant will have to get out when the house sells in any event.

Your cost of living most likely around the Atlanta area will be less than Chicago; and you may have a better chance of getting employment there after your unemployment income runs out. Your husband's H.R. Department has most likely been involved in similar scenarios during the past few years in this upside down housing market.

Move on and sleep better.
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Old 01-25-2013, 08:25 AM
2,188 posts, read 2,527,173 times
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Originally Posted by davebarnes View Post
Is your real-estate agent also a certified tax preparer?
Exactly. To determine the tax implications you really need to talk to a tax expert. I'm a CPA but don't work in tax so I wouldn't even consider myself an expert. Your realtor almost certainly isn't.

What the realtor may have been referring to is typically a rental property is passive income. Your expenses related to that property are only deductible against the passive income. And any excess(loss) wouldn't be deductible.

However, there is a rule that states if you yourself are involved with the property management then you're allowed to deduct the loss against your ordinary income, up to a certain limit(something like $25,000). So if you're looking at a loss from renting you may need to be involved with the management to make it work.

Again, please talk to a tax expert if you'd like to figure out the exact tax implications, and not put too much faith in what your realtor says.
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Old 02-01-2013, 07:03 AM
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Do not be surprised if the company refuses to buy your house. It is not that they don't value you, it is just such a hassle to the company (have to hire appraisers, realtors, accountants) and they will most likely counter with more upfront cash. IMO you are better off negotiating for a better salary, PTO, and to be part of management bonus schemes since these will be year after year. In my experience the moving cost is tax deductible however if the company pays for it you can't claim it and it will be a separate income line on the end of year tax form fromt the employer. Also there usually is some type of payback period - mine was 2 years. If you leave before you have to payback the reloc.

I have personally been thru this situation twice and am not qualified to speak on the tax issues and if I had to do it again would hire a knowledgable tax accountant as I am sure I missed on some things. However I do still own a prop out of state and have it rented out. Was losing 400 a month, but just re-fi'ed and am now -200 cash flow. Am about (-50k) in equity.

Also just closed on a house in my new location. Disclosed everything to both lenders and it was fine. I bought small in my new location at less than $90k with the thinking that my Wife's salary alone will support it.
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