Loopholes of Real Estate Quotes

“Case #6 Sandy and Bob Bob is a successful dentist in his community. In the 15 years since he established his own practice, he has established a reliable base of patients and has built a thriving business in a great location. A couple years ago, he brought his wife, Sandy, a business expert with an MBA, on board to help him oversee the business end of the dental practice. She had recently left her job at a financial services firm, and Bob knew that Sandy’s business acumen would be helpful in getting his administrative house in order. She brought on new employees, developed effective new processes, and enhanced the office’s marketing efforts. Within a few months, Sandy’s improvements had managed to make the dental practice a well-oiled machine. Now she could turn her attention to their real estate portfolio. Bob and Sandy owned three small apartment buildings around town, as well as one small commercial center that was home to a nail salon, a chiropractor’s office, a coffee house and a wine shop. Fortunately, Bob’s dental practice was a success and their investments earned a nice passive income for them. Unfortunately, because Bob earned on average $250,000 per year, the couple couldn’t use passive loss, which in their case came to about $100,000, from their investments to offset his high earned income. Eventually, they would be earning sheltered profits—when the mortgages on their properties were paid off and the rentals made pure profit, or if they were to sell a property. When those things eventually happened, they could use their losses to shelter those profits. But until that time, the losses were going unused. Sandy made an appointment with their CPA to discuss the situation and see how they might improve their tax situation. The CPA asked, “What about becoming a real estate professional?” He explained to Sandy that if she spent 750 hours per year, or about 15 hours a week, on the couple’s real estate investments, she would be considered a real estate professional by the IRS. This would enable the couple to write off 100 percent of their passive losses against Bob’s high income, which would bring his taxable income down to $100,000. This $100,000 deduction brought Bob and Sandy into a lower tax bracket, saving them roughly $31,000 in taxes. Sandy already devoted a large percentage of her time to overseeing their investments, and when she saw the tax advantages, her decision became clear: She would file the Section 469(c)(7) and become a real estate professional.”
― Garrett Sutton, Loopholes of Real Estate: Secrets of Successful Real Estate Investing (Rich Dad's Advisors

“tax laws allow you to offset your earned income by up to $25,000 in passive losses from real estate, as long as your adjusted gross income is below $100,000.”
― Garrett Sutton, Loopholes of Real Estate: Secrets of Successful Real Estate Investing (Rich Dad's Advisors

“income potential, full ownership, appreciation of equity, and tax deductions.”
― Garrett Sutton, Loopholes of Real Estate: Secrets of Successful Real Estate Investing (Rich Dad's Advisors

“Ordinary people just like you, with ordinary reserves of cash, have achieved great results in real estate investment, and you can too.”
― Garrett Sutton, Loopholes of Real Estate: Secrets of Successful Real Estate Investing (Rich Dad's Advisors

“A little education goes a long way in accomplishing four essential goals.”
― Garrett Sutton, Loopholes of Real Estate: Secrets of Successful Real Estate Investing (Rich Dad's Advisors

“Successful real estate investors realize the value of surrounding themselves with experts in a range of areas—taxes, the law, real estate, insurance, property management, etc.”
― Garrett Sutton, Loopholes of Real Estate: Secrets of Successful Real Estate Investing (Rich Dad's Advisors

“The government grants tax and legal loopholes to real estate investors to encourage them to do a job that the government can’t.”
― Garrett Sutton, Loopholes of Real Estate: Secrets of Successful Real Estate Investing (Rich Dad's Advisors

“Real estate investing will power up your earning potential and put you into a different class of investor entirely.”
― Garrett Sutton, Loopholes of Real Estate: Secrets of Successful Real Estate Investing (Rich Dad's Advisors

“as a real estate investor, you will be putting other people’s money—the lender bank’s and your tenants’—to work for you.”
― Garrett Sutton, Loopholes of Real Estate: Secrets of Successful Real Estate Investing (Rich Dad's Advisors

“Most of us don’t realize that real estate investments allow our money to accelerate at a greater pace than typical paper investments.”
― Garrett Sutton, Loopholes of Real Estate: Secrets of Successful Real Estate Investing (Rich Dad's Advisors

“Our financial, tax, and legal systems are set up to reward property owners”
― Garrett Sutton, Loopholes of Real Estate: Secrets of Successful Real Estate Investing (Rich Dad's Advisors

“Real estate investors can accelerate their wealth building much faster than with other assets, such as stocks, bonds, and tax-deferred retirement funds.”
― Garrett Sutton, Loopholes of Real Estate: Secrets of Successful Real Estate Investing (Rich Dad's Advisors

“There are great advantages to investing in real estate, both as a cash flow business and as a wealth builder.”
― Garrett Sutton, Loopholes of Real Estate: Secrets of Successful Real Estate Investing (Rich Dad's Advisors

“Real estate offers huge financial advantages to those who will learn the system.”
― Garrett Sutton, Loopholes of Real Estate: Secrets of Successful Real Estate Investing (Rich Dad's Advisors

“If you want to be a sophisticated investor, you must train your mind to see what your eyes cannot see.”
― Garrett Sutton, Loopholes of Real Estate: Secrets of Successful Real Estate Investing (Rich Dad's Advisors