There is a couple called
Mike and June Carpenter. (Real names are
withheld). They own a small family
dental practice. In their building is additional space that is often
vacant. Sometimes their real estate
expenses have outweighed their rental income.
This results in PASSIVE ACTIVITY LOSSES (PAL).
I met with their CPA
during a review and pointed out these losses on their 8582 tax form. I reminded
all parties that passive losses can only be offset by passive income. This approach guards against the passive
income from being taxed. This is also done
on a dollar-for-dollar basis.
I asked them to consider a
Real Estate Income Fund that could yield them approximately 9% and by using the
passive activity losses against the 9% return they could literally turn that 9%
yield into a tax-advantaged return.
Perhaps you’re missing out
on some of these possibilities in real estate.
Call or email me with your particular situation and I might be able to