As I enter my second year of USA Property Investing, I am beginning to go through some annual cycles; first up.  My property taxes in Memphis.  My Florida taxes are all paid automatically by the bank holding the loan which is handy,  however the Memphis ones I have to do myself.

I ventured gamely to the online portal, with my new US credit card:

https://www.shelbycountytrustee.com/index.aspx?nid=89

Thought it was all looking good until all the address details were US only for the ZIP code and country.  Bum.  I went ahead anyway adding an additional made up number for the ZIP and USA  and it went through!

So, a 5 minute job!

Mark

About Mark Taylor….

Mark Taylor is the Founder and Director of Keys To Success Club.   A property investor in his own right, Mark helps other people succeed in property investment by connecting them to property experts through Keys To Success Club.

A key focus on the club is to enable overseas investors to access the US Property Market opportunity.

For more information, click here

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If you invest in US property you must also lodge a US tax return.  You do not pay tax twice, as there is a tax treaty with Australia  and the US, so you will get a credit against your Australian tax return.

We have exploring getting US tax returns completed.  You can get Australian companies to do it for you.  Typically $300 per property.  We have, however, managed to source a US based accountant who will be able to to up to 3 properties for USD$395 which is a pretty good outcome and I suspect she will be more across local tax requirements than an Australian accountant.  I will be lodging my first next year, but Stephen is in mid process with his 10 properties.

Cheers for now

Mark

About Mark Taylor….

My property journey – Lodging US Tax Returns

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I am pleased to welcome on board Michael Jones onto our expert property panel.

Michael will be supporting our community with US Tax and Accounting.

About Michael Jones….

Michael Jones – US Tax Expert

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By Chris Gray

Accountants: A Valuable Asset

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By: Whitehouse Capital Partners

Currently NSW property investors that purchase off the plan are entitled to a 100% stamp duty saving for new property costing up to $600,000, provided that construction has not commenced and that contracts are exchanged before 1 July 2012.  Where construction has already started, then there may be a limited stamp duty saving of 25% – see www.osr.nsw.gov.au -home builder bonus fact sheet.  There are terms and conditions that apply and investors should make their own enquiries.

In NSW stamp duty is generally payable within 12 months of exchange of contracts or when the project completes, whichever is the former.

In Victoria there are substantial stamp duty savings available for off the plan property purchases.  The Victorian Government, in an attempt to encourage new development, has reduced stamp duty for purchase of property prior to it being built.  As construction of the development takes place the rate of stamp duty increases incrementally until the building is complete at which point the full rate of stamp duty is applied.  The greatest concession therefore is achieved before construction commences.

Transfer duty (stamp duty) in Queensland is payable for off the plan purchases at settlement.

For more information on other states – see The Office of State Revenue (OSR) web sites for each state.

  Stamp duty savings with off the plan property

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By: Whitehouse Capital Partners

 

 

 NSW Home Builders Bonus

The new Home Builders Bonus is a relief from stamp duty introduced by the NSW government. By doing this the government is aiming to increase the viability of developments, making it easier for developers to obtain finance through pre-sales. It applies from 1 July 2010 until 1 July 2012.

Complete exemption from stamp duty will be given to people buying a property off the plan, prior to commencement of building. It also applies to purchases of land under $400,000 and new homes under $600,000.

By purchasing an off the plan unit prior to commencement of construction, an investor can save up to $22,490. The government is also offering a full exemption for seniors purchasing new homes to be used as their principal place of residence.

If construction has commenced, the Bonus will be reduced to 25% of the payable duty. This rate will also apply to new homes where building has been completed.

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The NSW State Government has released the 2010/11 State Budget. Stamp duty relief has been announced by way of the “Home Builder’s Bonus” for a two year period in an attempt to boost the State’s housing construction sector.

First home buyers will receive benefits of up to $29,490 and families and investors up to $22,490 in stamp duty relief if the property they acquire meets the eligibility requirements for the Home Builder’s Bonus.

Key Changes within Stamp Duty are as follows:

NSW Home Builder’s Bonus:
The NSW Home Builder’s Bonus will come into effect from 1 July 2010 for a period of up to two years until 30 June 3012. This is designed to providestamp duty relief for eligible property buyers as follows.

Pre-construction Stage
- Stamp duty will be cut to zero for off-the-plan home purchases worth up to $600,000. This represents a saving of up to $22,490.

Note that this is also available to property investors.
This will only apply prior to any construction commencing on house and land packages or new apartments.

Properties Under Construction
- Stamp duty will be cut by 25 per cent for people buying a newlyconstructed home worth up to $600,000. This represents a saving of up to $5,623.
- The 25 per cent stamp duty cut applies to home purchases made at any time during the construction period, or at completion.

First Home Buyers
- First home buyers will also be eligible for the NSW Home Builder’s Bonus meaning that including the First Home Owners Grant of $7,000, the potential maximum benefit is $29,490.

Over 65’s
- Stamp duty for people aged over 65 will be cut to zero when they sell their family home (i.e. Principal Place of Residence) to “down-size” to a newly-constructed home worth up to $600,000. This represents a
saving of up to $22,490 in stamp duty.

Home Builder’s Bonus

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Property Depreciation Schedule

As mentioned previously, I said I would include my own depreciation schedule. This is for a brand new property, value of $475. You can see my total allowance in the first few years is around the $10k mark. Using a 40% tax allowance, this will give me an additional $4k cash flow, equivalent to an additional rent of $80/week which represents a 20% increase on my current rental arrangement. Certainly a useful amount.

Just remember, that whilst depreciation is useful for cashflow it does has some negative impact if you sell the property….

Property Depeciation Schedule Example

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Whilst I am in tax time mode, I thought I would track down some info to make sure that I was getting all my tax benefits.  Hopefully you have a good accountant, but I have found it useful to have a good understanding of all the benefits as no-one cares more about your money than you do; I have found plenty of mistakes with my accoutants over the years.

Tax benefits are an easy thing to miss out on and it is simply money down the drain.  Get it right early and you can get your processes set up from the word go.

tax tips for property investors

engage a specialist tax depreciation firm to carry out a depreciation schedule of your property. this will allow you to capture the depreciation on the plant and equipment within the property, the capital works including common areas …

Australian Property Investor :: What fees can you claim as tax …

Tax-related books are definitely deductible, as it’s to help you manage your taxation affairs and not to provide advice on buying rental properties. Investment magazines such as Australian Property Investor and newspapers such as the …

june 30 tax tips for property investors

he notes, “many property investors either don’t maintain an accurate depreciation schedule or have a schedule that is out-of-date.” a depreciation schedule shows depreciable [...] related posts: rhsa adds up costs for investors raine …

Tax tips for property investors

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A little behind on my tax return, and have been waiting on a depreciation schedule.  It is getting more mainstream now, but you absolutely would be foolish not to get out a depreciation schedule completed on your investment property.  Don’t forget that this applies to older properties as well as newer properties.  To give you an idea I will show the one I have just completed in another post, but for now here are a few links to explain the concept of a depreciation schedule in more detail….

what is rental property depreciation and why it is vital to you

rental property depreciation is a highly important concept for those who own or manage rental properties. understanding how to calculate it is crucial for maximising your tax deductions and slashing your overall real estate taxes. …

depreciation – unlock the hidden cash flow in your investment property

according to depreciator.com.au 80% of property investors don’t take advantage of depreciation. to claim depreciation, you need a tax depreciation schedule put together by a quantity surveyor. a tax depreciation schedule is a report on …

tax depreciation on older properties

a recent tax depreciation schedule that i prepared on an older property had over $150000 in renovations and the depreciation that the owner received was more than what some newer properties were entitled to. …

Property Depreciation Schedule

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