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Those employers didnt "********* over." They did something that you, no doubt, will find remarkable. They followed the law. And they deducted the expense of paying you as a business expense.
Glad I supplied the answer you needed, but dont come back looking for help or sympathy when this blows up in your face, okay?
Oh don't worry, it won't blow up in my face. How do you think I was able to save up so much money when in NYC? Side gigs that paid under the table. Now, of course, I also had several other side gigs like catering that were the 1099 b.s. but the majority of my side jobs were under the table cash that really allowed me to save up (not just save up 70% of it). That didn't end up blowing in my face when purchasing a home and this will not blow up in my face either.
I'm 25 y/o, own a 2,000 sq ft home and have a great job that I love and am passionate about. I work hard and reap the benefits from my hard work. I want to provide for my family and get them out of the Northern VA area, which I will. Just a matter of time. Just have to line up my ducks in a row (hence the planning a year in advance).
I know you do gooders here wish to see me fail and hope this blows up in my face but it won't, 'okay'? Now move along to another board where you can actually give helpful advice, since I'm clearly not looking for sympathy (nor need any!).
I know you do gooders here wish to see me fail and hope this blows up in my face but it won't, 'okay'? Now move along to another board where you can actually give helpful advice, since I'm clearly not looking for sympathy (nor need any!).
But I'm the one you previou thanked for giving you the information.
I'm an old lady, so allow me to give you a bit more information. You're a 25 year old who works hard and has done well. You deserve respect for that AND for wanting to help your family. Being cocky is unattractive and shows immaturity. Being so defensive indicates you have some recognition that your decisions and actions are wrong (ethically and legally); hence, they require defending
Oh don't worry, it won't blow up in my face. How do you think I was able to save up so much money when in NYC? Side gigs that paid under the table. Now, of course, I also had several other side gigs like catering that were the 1099 b.s. but the majority of my side jobs were under the table cash that really allowed me to save up (not just save up 70% of it). That didn't end up blowing in my face when purchasing a home and this will not blow up in my face either.
I'm 25 y/o, own a 2,000 sq ft home and have a great job that I love and am passionate about. I work hard and reap the benefits from my hard work. I want to provide for my family and get them out of the Northern VA area, which I will. Just a matter of time. Just have to line up my ducks in a row (hence the planning a year in advance).
I know you do gooders here wish to see me fail and hope this blows up in my face but it won't, 'okay'? Now move along to another board where you can actually give helpful advice, since I'm clearly not looking for sympathy (nor need any!).
Don't fail, just come clean and pay your taxes.
You seem to essentially be arguing that you can't afford your taxes. I might suggest that unless the family has a serious and otherwise unresolvable hardship, you have your priorities a bit out of line. I realize it may be emotionally difficult to see their rent money leave the family, but is it really worse than committing fraud?
My intent is not for you to run into trouble at all, rather, I suggest you seriously think about your priorities.
You will have chances to to this again in the future. Having to miss one real estate deal is not the end of the world. You're 25 and have a long time to go, surely you will find another deal in the future when you can afford it. (If you have to cheat on taxes, you can't afford it.)
If the real issue is your family being stuck in northern VA, why don't you just help them find a job in your area and maybe write them a small check to cover their moving expense? They can rent. Yes, the money will leave the family, but again this is not your only chance to go into rentals. You will get another chance, even if you feel like it takes forever, it will come. And the rent money from your tenants in the future, once deposited to your bank, will be no different than money you could have got from your parents - a dollar is a dollar is a dollar. Control the emotions and you'll be fine.
I won't comment on the IRS issue...plenty of people have said enough there. But as you've realized by now, from a business standpoint if you want to depreciate your investment property, write off other expenses, etc then you need to treat it like an INCOME property. If you need lenders to help you out you're going to need to reflect this on your tax returns. Some banks may take just a lease, but that's if the property isn't going to be showing up on your previous returns yet (less than a year or so)
Other routes you could go are non-conventional financing, but chances are they'd still want documentation of income and certainly the rates would be higher than you'd want for a long term hold (usually 8-15%). You could also find an investment "silent partner" who has the money and funds you as a loan at an agreeable rate for you both (perhaps 7 or 8%)...or an investment partner to give you the borrowing power you seek but you'd have to split the profits more equitably. The non-conventional financing route sets its own rules so you can find any type of deal if there's someone out there who wants it, but generally they will expect some collateral, they'll usually need to be already investing in your area, and the more risk they take the higher their rates will be. If you want low rates you'll have to show a healthy income.
@jkgourmet, my apologies for coming across as cocky. I, like you, just like to give more background information if I feel it is relevant. I'm not some old, sketchy dude that brings ppl into my home. lol I'm a legitimate Acct Manager who works full time but enjoys making side income from my tenants who live with me. We all have a great relationship, respect each other. We've only lived together for about a month now, but so far so good in that respect. We are both holding up our end of the lease agreement.
@ncole1, Thanks, I hear what you are saying. It's not that I can't afford to pay my taxes. It's that I honestly feel the government does not deserve their cut. For what? I bust my behind off for my house. I understand I'm going to get tax breaks for being a homeowner next year so I'm looking forward to that and will see what the balance is after everything is said and done when filing next year. As for my family's situation. My Dad is a retired vet who makes a monthly check that is just enough to cover rent. My Mom just got laid off yesterday but was making about $2,000/month which helped them pay for utilities and food (feeding a house of 5 people). My sister, brother-in-law, and nephew all live with my parents in a 2 bed/ 2 bath apartment. While my sister and brother-in-law both work, they have a LOT of expenses, mainly due to mis-prioritization such as a nice car which comes with a hefty car payment, etc. Waiting around while my family digs deeper and deeper in the hole isn't really an option. I was hoping to start house hunting in January so they could be in a 3 Bedroom house in May. I know renting is always an option, however, I really don't want it to come to that, because I do view rent as a waste. I know not everyone has that same viewpoint, but that's how I see it. My parents are getting older too so would love for them to be near me in case anything happens. I mean they are in their 50s and 60s not that old, but still lol I just know they will be much happier here in Richmond and I will feel better knowing that they have more money in their pocket and less stress.
@projectmaximus thank you for your level-headed response and not further beating the dead horse convo about the IRS. I haven't really thought about going in with a "silent partner" and not sure I would be interested in that, but it is something to consider and I want to think of all options so thanks for making me think of that. I wish my parents' credit scores would qualify them for owning a home so I could just help them with closing costs, etc. but unfortunately they foreclosed on a home years ago so that's not an option. I understand about having low rates and showing a healthy income. My current rate now is 3.5% and I'm very happy with that fixed amount locked in. That's why I wanted to show extra income. I wouldn't even mind paying taxes on it IF my lender told me that the rental income will count towards my total amount of income
Thanks again- I think I gave you all rep points (unless I was maxed out).
So, I think next steps right now are for me to just save, save, save. Go back to my lender in January and apply for a mortgage for a small house/townhome. If I get approved, great. If not, then I look into rentals for them because I will at least have saved up a large amount of funds for first month and security deposit for it. That way, it gets them out of Northern VA either way.
As for the IRS, I have plenty of time before filing 2015 taxes. I can come back and report on the outcome in 2016...
I, for one, sincerely appreciate your courteous response. That's a classy and unusual thing around here!
But, after reading your post, I do have a couple of questions - which are a bit OT and certainly none of my business.
You want your parents to leave where I suspect they have been living for a long time and move closer to you. Have you asked them if that's what they want to do?
You referred to getting your parents a 3 bedroom house, presumably so the sister, BIL and nephew could continue to live with them. While I commend your efforts to help your parents (though don't agree that in their fifties, they are "old"), I won't condone your efforts to allow the adult sister and husband to continue to leech off your parents, and eventually, leech off of you. Why do you insist on supporting everyone in your family, instead of allowing people (specifically, sister and BIL) to live within their means and learn from their own mistakes?
The first one- Yes, I asked my parents if they wanted to move here. My Mom was included in the tours when I did my house hunting here and also visited often when I was in college here for 4.5 years. Her and My Dad love the charm, the slower pace, the less traffic, etc. In fact, last time they were here my Mom was pointing out some houses that she would love to live in - mostly a quaint, Cape Cod style.
Ideally, I would love for my Sister and Brother in law to get their own place (whether it's in Northern VA or Richmond). They both have jobs in the NoVA area so it would be great for them to get their own place, but I was just thinking that it would be nice for my sister and brother in law to pitch in and help with the payments, utilities, etc. I think with my Dad's check from the military ($1400/month) and then the money my sister and brother in law make, they could all live there together and make it work. Plus, 3 bedroom house is a bigger improvement than 2 bedroom apartment they are currently in.
I always tell my parents to get a backbone and kick my sister out but they won't do it. They always think about my nephew who is 11 y/o and they want him to have a stable environment. My parents help him with his homework, pack his lunches, etc. My Dad, since he is unemployed (and now my Mom) stay home all the time and can get my nephew on and off the bus. He doesn't have to be a latch-key kid, which is what he would be if he only lived with my sister and brother in law since they work all the time. I know their priorities are messed up but they are trying to get it together. I think family should just pitch in and help each other if they are in the position to do so. I hope my sister really steps up soon though. I know she's looking for another property management job. So hopefully she doesn't have to keep being a waitress at IHOP.
Sorry for the storybook of my life But yes, very stressful situation for sure!
harrisce4: I still think you're very wrong about not paying your taxes, and sincerely believe that one day it's going to bite you in the butt (either directly or karmic-ally speaking).
But I'll admit that I don't believe you're as much of a jerk - or as cocky - as I did at the beginning of this thread.
Good luck.
Last edited by Jkgourmet; 05-06-2015 at 12:50 PM..
@jkgourmet, my apologies for coming across as cocky. I, like you, just like to give more background information if I feel it is relevant. I'm not some old, sketchy dude that brings ppl into my home. lol I'm a legitimate Acct Manager who works full time but enjoys making side income from my tenants who live with me. We all have a great relationship, respect each other. We've only lived together for about a month now, but so far so good in that respect. We are both holding up our end of the lease agreement.
@ncole1, Thanks, I hear what you are saying. It's not that I can't afford to pay my taxes. It's that I honestly feel the government does not deserve their cut. For what? I bust my behind off for my house. I understand I'm going to get tax breaks for being a homeowner next year so I'm looking forward to that and will see what the balance is after everything is said and done when filing next year. As for my family's situation. My Dad is a retired vet who makes a monthly check that is just enough to cover rent. My Mom just got laid off yesterday but was making about $2,000/month which helped them pay for utilities and food (feeding a house of 5 people). My sister, brother-in-law, and nephew all live with my parents in a 2 bed/ 2 bath apartment. While my sister and brother-in-law both work, they have a LOT of expenses, mainly due to mis-prioritization such as a nice car which comes with a hefty car payment, etc. Waiting around while my family digs deeper and deeper in the hole isn't really an option. I was hoping to start house hunting in January so they could be in a 3 Bedroom house in May. I know renting is always an option, however, I really don't want it to come to that, because I do view rent as a waste. I know not everyone has that same viewpoint, but that's how I see it. My parents are getting older too so would love for them to be near me in case anything happens. I mean they are in their 50s and 60s not that old, but still lol I just know they will be much happier here in Richmond and I will feel better knowing that they have more money in their pocket and less stress.
@projectmaximus thank you for your level-headed response and not further beating the dead horse convo about the IRS. I haven't really thought about going in with a "silent partner" and not sure I would be interested in that, but it is something to consider and I want to think of all options so thanks for making me think of that. I wish my parents' credit scores would qualify them for owning a home so I could just help them with closing costs, etc. but unfortunately they foreclosed on a home years ago so that's not an option. I understand about having low rates and showing a healthy income. My current rate now is 3.5% and I'm very happy with that fixed amount locked in. That's why I wanted to show extra income. I wouldn't even mind paying taxes on it IF my lender told me that the rental income will count towards my total amount of income
Thanks again- I think I gave you all rep points (unless I was maxed out).
So, I think next steps right now are for me to just save, save, save. Go back to my lender in January and apply for a mortgage for a small house/townhome. If I get approved, great. If not, then I look into rentals for them because I will at least have saved up a large amount of funds for first month and security deposit for it. That way, it gets them out of Northern VA either way.
As for the IRS, I have plenty of time before filing 2015 taxes. I can come back and report on the outcome in 2016...
If the family is subsidized whenever they get in trouble, they won't learn from their mistakes. They'll do the same things again, and drain you and drain you until you're bankrupt. (If they stop paying rent, are you going to evict them, or are you going to wait until your credit is in the trash and are about to be foreclosed on before you do anything?) I realize you may not want to hear this, but you are enabling, especially when the sister and BIL come in to the picture. And please, ditch the dogma about renting being a waste of money - you need to consider the greater consequences of their actions, and your actions. This dogma is not only untrue but is dangerous in a case like yours.
Fifties is NOT old, it will likely be quite a time (20 years?) before they really can't take care of themselves. Your goal should be to teach them to manage their money responsibly, not to enable. And this applies more to sister and BIL than parents - if they have to get the expensive car repoed to learn, so be it. Let them learn, don't let them drag you down (which it sounds like you are on your way to doing).
Just curious, how would they know? Last I checked, H&R Block has no access to my bank account which is the only place the transactions can be found.
When you file your taxes, you must declare your income by law. Don't hide it. It WILL be found!
Property tax records! Everything is linked back to you.
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