Condo Investers Info?

[russellmania]

I've heard that if a person has a rental property overseas and they manage it themselves,they can claim a tax write off including the travel expenses. Any you guys have any knowledge or personal experience on this?

[bows00]

Wouldn't that travel expense apply to any long distance real estate investment? 

[Thomas]

I've heard that if a person has a rental property overseas and they manage it themselves,they can claim a tax write off including the travel expenses. Any you guys have any knowledge or personal experience on this?

I have no idea for USA, but in Sweden in general we can APPLY for ANY deductions as long as we tell true data, then the tax people are suppoused to say ok to relevant costs IF the amount is reasonable compared to how big the business and it's result is. I guess it's much biger chance they say ok if showing a bookkeeping profit result than if the applied deduction make a (biger) minus result.

(That's why I normaly show a small bookkeeping plus result years I don't need to do that because of investments, to get more deductions kept in the bookkeeping left to when I need them   :)

[JJReyes]

Our real estate company has experienced abusive visitors who pretend to be on a real estate buying trip and they then deduct their vacation expenses as a business trip. The telltale sign are in their communication, "I am buying a $1 million beachfront home." If they are millionaires who have done the research, there is no such thing as a $1 million beachfront property in Hawaii. Prices are $3.5 million and up. Another is giving their arrival date & time with the expectation of an airport pick-up. This we never do. They have to come to the office for the first meeting, unless the introduction was from an existing client. We would then meet them at their hotel lobby.

 

The IRS is not stupid. We keep accurate records. Someone tried to charge their two weeks Hawaii vacation as a business expense. Our records, shared with the IRS upon the request of their investigator, is the couple came to our office for a 45 minutes courtesy visit. I am pretty sure they got nailed for fraud.

 

In direct response to the information requested, the IRS permits a reasonable deduction for ordinary expenses. You can deduct the one or two days spent visiting your rental property; meeting with the manager; arranging repairs; etc. You can't charge the airfare unless the entire trip was spent solely on real estate. Red flags include spending $2,500 for the trip and your declared earned income from rental is only $10,000. I would be very careful. Once you get a red flag, your 1040 Income Tax Returns will be scrutinized every year.

Edited January 3, 2014 by JJReyes