#adjusted basis

[datarep]

Georgia Confirmed Covid-19 Cases by County on Population-Adjusted Basis

[turbotax]

Cost Basis: Tracking Your Tax Basis

"Basis" is one of the most important words in the lexicon of taxes. Sometimes you see it by itself. Sometimes it's called "cost basis" or "adjusted basis" or "tax basis." Whatever it's called, it's important to calculating the amount of gain or loss when you sell an asset. To find out more about this important tax concept, see the full TurboTax article.

[starksh]

Wholesalers Who Are The Best?

Let us introduce the #wholesaler to the distributor and his importance in getting the product to market. The distributor usually contracts with the wholesaler to buy his widgets at a reasonable price but still profitable to the wholesaler.

We have used some different terminology to explain the drop ship business. In the drop ship business, it is important to know who is who and what is what. Let us start in the beginning with the wholesalers. Many wholesalers are manufacturing companies that make a product out of their factory.

They do not deal with sales or advertisement because this would indeed cause the cost of the product to…

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[rosie-katt]

Wholesalers Who Are The Best?

Let us introduce the #wholesaler to the distributor and his importance in getting the product to market. The distributor usually contracts with the wholesaler to buy his widgets at a reasonable price but still profitable to the wholesaler.

We have used some different terminology to explain the drop ship business. In the drop ship business, it is important to know who is who and what is what. Let us start in the beginning with the wholesalers. Many wholesalers are manufacturing companies that make a product out of their factory.

They do not deal with sales or advertisement because this would indeed cause the cost of the product to…

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[thompbrian]

What You Need to Know About the Tax Consequences of Selling a Rental Property

On Monday, I advised a reader that she should keep her rental property that provides positive net rental income and is creating equity without cash from her and her husband.

She also wanted to know the tax consequences if she and her husband did decide to sell, so I want to touch on that today.

Here’s what she and you need to know:

The Basics

Your profit or loss on a rental property, like most other investments, depends on the sale price of the property minus your adjusted basis.  Your basis in the property starts with its cost but can also get increased or reduced given certain events (hence the word “adjusted” basis).

Some examples of events that increase your basis include:

The costs of additions or improvements

Legal fees related to the property

Amounts spent to restore the property after it’s damaged

A reduction in basis can come from:

The amount of any insurance or other payment you received as a result of a casualty loss or theft

Any deductible casualty loss not covered by insurance

Amounts depreciated on your income tax return

So, for example, if the reader original purchased the property for $150,000, made $50,000 in improvements, but also depreciated $40,000 on her tax return, her adjusted basis would be $160,000. 

If she ends up selling the property for $250,000, she would realize a $90,000 profit (or gain) from her investment.

The Depreciation Recapture Wrinkle

The most common reduction in basis comes from depreciation.

Simply put, depreciation is an annual allowance for the wear and tear on a property. It allows you to recover the property’s cost over an extended period of time. 

You can start claiming depreciation when you put the property into service for use in a trade or business. You can no longer take depreciation when you recover the full cost and other basis.

You deduct depreciation for a rental property on the schedule E, along with other rental expenses such as mortgage interest, taxes, insurance, maintenance, and repairs.

However, the tax consequences for profit due to the recapture of depreciation are a bit different.

The tax rate for the amount of profit due to depreciation – in my example above $40,000 – would be taxed at 25%. The rest of the gain $50,000 would be taxed at the long-term capital gains rate (currently 15% or 20% depending on your income).

So you may find yourself calculating a combined tax rate on your schedule D. Luckily the IRS offers a handy worksheet when trying to figure it out. (Or you could always just leave it to your tax advisor.)

Is There a Way to Avoid Paying Taxes?

If the rules sound a little confusing it’s okay: they are. As with most things in the tax code there are rules, exceptions, and exceptions to the exceptions.

There is even a way to defer paying tax on any profit by investing in another rental property. This is called a 1031 exchange and will have to be its own blog post.

Lastly, because the reader lived in the property before it was rental, there may be an additional way for her to avoid paying tax on some of the profit. Tune in on Friday for that tip.

[news-canada]

U.S. home prices rise 1.1% in May amid signs of waning pressure

U.S. home prices rise 1.1% in May amid signs of waning pressure

  U.S. home prices rise 1.1% in May amid signs of waning pressure

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The Future is Binary — U.S. house prices rose 1.1% in May, according to the Case-Shiller 20-city composite index released Tuesday, with every city showing gains. On a seasonally adjusted basis, however, prices fell 0.3%. On a year-on-year basis, price growth decelerated to a 9.3% rate from 10.8% in April,…

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[news-canada]

Pandora posts wider loss; shares fall

Pandora posts wider loss; shares fall

  Pandora posts wider loss; shares fall

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The Future is Binary  - Pandora Media P -11.21% on Thursday reported a second-quarter net loss of $11.73 million, or 6 cents a share, compared with a loss of $6.9 million, or 4 cents a share, for the year-earlier period. Revenue rose to $218.89 million from $153.1 million. On an adjusted basis, the company reported a profit of 4…

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[news-canada]

Home prices up 0.8 percent in February: S&P/Case-Shiller

  Home prices up 0.8 percent in February: S&P/Case-Shiller

  The S&P/Case-Shiller composite index of 20 metropolitan areas rose 0.8 percent in February on a seasonally adjusted basis. A Reuters poll of economists had forecast a 0.7 percent rise.

  Read more: http://www.cnbc.com/id/101623522

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Tuesday: Case-Shiller House Prices

U.S. home prices rise in January: S&P/Case-Shiller…

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