How to Refinance Investment Properties Inside LLCs

Several of today’s tax questions are related to STRs (Short-term rentals) like Airbnb and VRBO. Toby Mathis and Jeff Webb of Anderson Advisors discuss the differences between passive or active income on these popular investment properties, and answer additional tax-related questions. Submit your tax question to taxtuesday@andersonadvisors.

Highlights/Topics:

• Investing in multiple family syndications - I think when you make an aggregation election, you're electing to treat all your rental activities as one activity
• Setting up ongoing support for 501(c)(3) organizations that support the advancement of religion - Make it a private foundation. Spell out your values and then say, here are the organizations that I believe meet that at this time- but understand how wildly society and religion might change over time
• Short-term rentals/hotel syndications - active or passive income? Unless you’re an employee like the general manager of the investment property, you’re passive. This is not a rental activity, period. Hotel syndication or short-term rental, just remove the ‘rental’ and it’s a regular business
• A real estate investor pays almost no taxes, but her husband is a 1099 contractor with a huge tax burden. Should they put some properties in his name? If you’re filing jointly, it won’t matter. You could also donate a property for a community service/non profit to get the deduction of the full market value
• There are still actions you can take if you’re getting killed on 2021 taxes, the clock has not stopped on 2021yet!

Resources:

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