Any Tax Shelters still out there...?

Sonic dB · Sonic dB's Garage

Ive been debating posting this for awhile, but you guys are a pretty knowledgable and experienced bunch... so... my situation is that Im single, renting in So Cal and will earn good money this year. Last year, under similar earnings, I got the hell taxed out of me.

Back in the day, I owned a home in MI and was able to deduct the mortgage interest and property taxes....but out here in CA, i have no interest in purchasing a home... I expense a lot of sales related things...but the question is: What, if any "tax shelters" are available for a single no-dependants person these days? Any ideas on how I could reduce my tax bill for this year? PMs would be fine, also if you know a good tax person in my area let me know his/her name... thanks

motion · 06-28-2005, 05:52 AM

Why so against purchasing a condo or home? Its the best thing going for tax purposes. Or, buy a rental. Doesn't have to be in a pricey area. Pick one up out in Bakersfield. Write off every little thing you buy at Home Depot. For 99% of people, real estate is the ONLY way to real wealth.

turbo6bar · 06-28-2005, 02:10 PM

If I'm not mistaken, you can only carry $25k of losses in RE against your regular income. To increase this amount, you need to work in real estate about 750 hours per year (scouting properties, remodeling, any actitivity related to RE duties). Most part-time landlords say the hour threshold is not hard to reach, but it sounds like a lot to me.

The primary drawback to RE investing these days is rampant appreciation. I do not think this is the best time to get in the game.

motion · 06-28-2005, 02:39 PM

Jurgen.. some areas are still considered to be undervalued. Some cities in Texas, Salt Lake City and Albuquerque come to mind. Money always flows in the path of least resistance... those markets still have appreciation left in them, IMHO